The current constitution, which was approved under Chavez in 1999, allows only two successive presidential terms.
Chavez had sought changes to 33 articles of the constitution, but the legislature modified 69 of its 350 articles.
If approved by Venezuelans in the December poll, the changes will also reduce the number of hours in the working day and extend social security benefits to some self-employed workers. Voting age will be reduced from 18 to 16.
"Today the Venezuelan people have a pencil in their hands to write their own history, and it's not going to be the history of the elite," said Earle Herrera, a pro-Chavez parliamentarian.
But Ricardo Gutierrez, a parliamentarian opposed to the changes, described them as "unconstitutional," and said "that don't have anything to do with giving more power to the people."
Government supporters wearing red, the color of Chavez's ruling party, cheered outside the assembly in central Caracas as politicians began the process of organising the referendum.
But Jose Manuel Gonzalez, president of the Fedecamaras business chamber, warned of grave consequences if voters agree to the amendments.
"If this reform is approved, it destroys the future of our institutions, isolates us as a nation, brings us back to the past and distances us from modernity and progress," he told Union Radio.
Concerns that the measures will weaken civil liberties have been raised by university students, opposition parties, human rights groups and representatives of Venezuela's Roman Catholic Church.
Thousands of Venezuelan students took to the streets in angry protests on Thursday to demand a two-month delay of the referendum to allow more time for a nationwide debate on the constitution.