The draft constitution, which has been in the making since 2001 provides for two houses of parliament - a 75-member National Assembly and a 25-member National Council.
"King Jigme Singye Wangchuck would become head of state, but parliament would have the power to impeach him by a two-thirds vote," Kinley Dorji, editor of the government-owned Kuensel newspaper, said on Sunday.
The draft constitution was circulated on Saturday across Bhutan's 20 districts for debate among the nation's 700,000 people, Dorji told The Associated Press by telephone.
No date has been set for adoption of the constitution. "Like every Bhutanese, I am excited as the new form of government will change the way of life in my country," he said.
The drafting committee, set up by the king, has suggested a system different from those in neighbouring India and Bangladesh.
Rules of the road
A primary round of elections would be held to choose two parties, which would contest the general elections for the National Assembly. The winning party would run the government and the losers would sit on the opposition benches.
Dorji said the king told district officials last week that the election commission would conduct the voting and fund the political parties.
"The new form of government will change the way of life in my country"
Kuensel, official newspaper
"The people will now read and debate the provisions of the draft constitution before the king tours the nation for consultations before the document is adopted," Dorji said.
"The adoption of the constitution will provide a legal framework for a democratic political system that is best suited for Bhutan and will establish a system of governance that will safeguard the security and sovereignty of the nation and ensure the well-being of the Bhutanese people for all time to come," the newspaper quoted the king as saying last week.
The Budhdhist country has been ruled by a monarch since the early 20th century.