Windows Phone 8 shares much of its code with the firm’s PC system, making it easier for developers to write programs for different types of devices.
The company said it should indicate there would be various “amazing games” for handsets running its new release.
A tie-up with Nokia has already brought some Windows Phone devices to market, but sales lag some way behind models running Android or Apple’s iOS.
Microsoft said HTC, Samsung, Nokia and Huawei would all be making devices powered by the system upgrade.
Other new features announced at the Windows Phone Summit event in San Francisco included:
Support for multi-core chips, allowing devices to turn on cores to access extra processing power when needed, and to switch off cores when not to preserve battery life.
The capability to work with different screen resolutions including the high definition 720p format.
Support for removable Micro SD cards allowing users to store more media files or install apps saved on the format.
A new “wallet” app allowing the phone to act as both membership and credit cards. It also supports NFC (near field communication) payments.
Built-in maps from Nokia’s Navteq division with turn-by-turn navigation.
A more customizable start screen allowing users the selection of three tile sizes to represent installed software and more color options.
A warning alert if the software believes a website contains malware or is otherwise unsafe.
Windows Phone 8 screenshot Application tiles can be made to look smaller.
The update also allows internet call software based on video chat technologies and VoIP (voice over internet protocol) to run in the background.
This addresses a complaint that the firm’s own Skype program could not be used to receive calls while its owner was using another application - a function offered on rival platforms.
The firm said VoIP calls should now “feel like any other call” received or made by Windows Phone handsets.
Windows Phone 8 and Windows 8 strongly resemble each other – at least when the PC system is run under its Metro interface – and Microsoft was keen to stress that their relationship goes deeper than appearance alone.
The two will share a range of components including graphic drivers, the DirectX collection ofapplication programming interfaces (APIs) and the NT kernel that ties application software to the hardware it is installed on. They can also both support native code in the C and C++ programming languages.
Microsoft said this should not only build it easier to port software between the two environments, but should speed up the time it takes developers to recode programs originally built for Android and iOS.
Microsoft noted more than 100,000 apps had been released for Windows Phone 7.
By contrast there are more than 466,500 programs in the Android marketplace according to search site Appbrain, and “over 500,000″ in Apple’s app store according to the iPhone maker.
Surface tablet the system software that powers Microsoft’s Surface tablets shares many components with Windows Phone 8
Securing “marquee titles” is more important to some than raw numbers, and Microsoft addressed this too with news that Game loft’s Nova 3 and Zynga’s Draw Something were coming to Windows Phone.
“Until now handsets running Microsoft’s system have been missing some of the most innovativeapplications and popular games,” said Malik Saadi, principal analyst at Informa Telecoms.
“Now with the update from Windows Phone 7 to 8 this should be addressed. Many of the developers I had spoken to had said they were holding off until they knew more about the new system. It looks like that barrier has now gone.”