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| Cars drive on the Three Ring Road amid the heavy haze in Beijing February 26, 2014. |
It is proposing limiting sales to 80,000 units every 12 months, to be split evenly over that period, the government said on the city's official website (www.hangzhou.gov.cn).
A final decision on details of the curbs will be released at the end of April, the government added.
China's leaders have declared a "war" on pollution, as they seeks to calm public ire over water, air and soil pollution that often reaches levels experts consider hazardous.
This has seen an increasing number of Chinese cities limit sales of gasoline vehicles, a key contributor to air pollution.
The trend is pushing carmakers to shift their focus towards smaller cities and speed the development of electric vehicles, which are free from similar curbs.
The Hangzhou government said the decision aimed to tackle both pollution and traffic jams.
Hangzhou, capital of the prosperous province of Zhejiang, is a tourist attraction best known in China for its lake, but its luster has been dulled in recent years by a recurrent smog problem.
Five Chinese cities -- Shanghai, Beijing, Tianjin, Guangzhou and Guiyang -- have already put curbs on car sales and more are expected to follow.
Some cities use an auction system to allocate number plates while others use a combination of lotteries and auctions.
