The Scottish Government is to scrap laws which allow children under 16 to be held in jail without having been convicted of an offence.
Currently, they can be remanded in custody if their behaviour gives cause for concern.
The practice has been consistently criticised by the prisons inspector and the children's commissioner.
In future, children issued with an "unruly certificate" will be placed in secure accommodation.
Justice Secretary Kenny MacAskill said authorities would also be given the option of tagging young people or sending them home.
Currently, a small number of 14 and 15-year-olds are either sent to young offenders' institutions or adult prisons while they are awaiting trial.
Mr MacAskill is proposing that they are allowed to remain in secure accommodation even after their 16th birthday, rather than be automatically transferred to prison.
Prisons inspector Andrew McLellan welcomed the announcement, claiming that prisons containing hardened criminals were no place for children.