The plans have been approved in principle by Thailand's telecommunications regulator, which denies it is an invasion of privacy.
The body says it is intended to catch those who overstay their visa.
More than 19 million foreigners have visited Thailand this year, says Thailand's Tourism and Sports Ministry.
The National Broadcasting and Telecommunications Commission (NBTC) said the special Sim cards would come with tracking enabled, which the user could not turn off.
As well as visa overstayers, it said it could also be used to find those on the run from police. But it said authorities would need a court order to track a phone.
While the proposal has been approved by the NBTC, Secretary General Takorn Tantasith said the organisation would consult with police, tourism authorities and tour operators before deciding whether to implement it.
He added that foreigners working in Thailand would not be required to use the special Sim cards, although some local reports have quoted him saying they would.
The proposal has been backed by other parts of Thailand's military government.
"It will be helpful, if any foreigner comes and commit crimes, because in the past they have been able to flee or it can be difficult to find them," said Pongsathorn Chansri, an official in the Ministry of Social Development and Human Security.
Thailand is considering requiring tourists to use special Sim cards that would allow authorities to track their mobile phones.