Mr. Bush signed the order Friday and the White House announced the order Monday.
Homeland Security Secretary Michael Chertoff and Commerce Secretary Carlos Gutierrez planned an afternoon news conference to discuss the order and other ways the administration has stepped up its crackdown on illegal immigration.
The order says federal departments and agencies must require contractors to use an electronic system to verify that the workers are eligible to work in the U.S.
The order is aimed at cracking down on hiring of illegal immigrants. But people who overstayed visas or came to the country legally but do not have permission to work, such as some students or those awaiting work permits, also could be snagged with the system.
"It is the policy of the executive branch to enforce fully the immigration laws of the United States, including the detection and removal of illegal aliens and the imposition of legal sanctions against employers that hire illegal aliens," in the executive order says.
The order comes as a worker verification bill has essentially stalled in Congress. A Democratic immigration enforcement bill would require employers to check the citizenship and legal status of all their employees.
The issue has long been debated but has run into opposition over the years from business groups who say the E-Verify system is flawed and civil libertarians who say it will lead to discrimination and job losses by U.S. citizen workers misidentified as illegal workers.
Comprehensive immigration bills considered by Congress in 2006 and 2007 included worker verification measures. But after they failed, states began passing their own laws to keep employers from hiring undocumented workers.