The 65-year-old Touadera was first elected in 2016, then re-elected in a highly controversial poll in 2020. The current constitution would not allow him to run for the presidency again.
"A commission has been created to write a draft constitution for the Central African Republic," a decree signed by the president and his prime minister said.
It is to hand the president its draft, the decree added.
The country's political opposition is strongly opposed to Touadera staying on.
His supporters are urging him to have any constitutional amendment adopted by referendum.
In parliament, it would need two-thirds of votes to be approved.
One of the world's poorest countries, the Central African Republic has been torn apart by civil wars for much of the past nine years.
Touadera won a second term in office in December 2020 polls in which only one in three citizens made it to the ballot box due to ongoing fighting.
Rebels tried to oust Touadera in late 2020 by launching an offensive on the capital Bangui, but the army managed to repel it with help from hundreds of Rwandan soldiers and Russian paramilitaries.