The burn ban decree will be published Thursday. Exceptions for burning include cases of approved agriculture and forestry practices.
More than 1,000 new fires were started Monday and Tuesday, taking the total number of fires to more than 83,000 for the year, the highest since 2010.
The wildfires have also become a political lightning rod for climate change activists and French President Emmanuel Macron, who has accused Bolsonaro of lying about his commitment to the environment and protecting the rain forest. Bolsonaro demanded an apology from Macron and, at first, refused the G7's offer of $20 million of emergency aid.
He later agreed to accept the money as long as Macron apologized. He also accused France of having colonial ambitions for Brazil and said the fire aid would be spent how he sees fit.
The spat threatens to derail the EU-Mercosur trade deal that involves the European Union and several South American countries. Bolsonaro supported an Amazon summit in September so Peru, Brazil and Colombia can work together on a strategy to protect the rain forests.
The United States is part of the G7 but doesn't support the $20 million pledge, a Trump administration official said.
"We didn't agree to a G7 initiative that failed to include consultations w/ @Jailbolonaro," National Security Council spokesman Garrett Marquis tweeted late Wednesday. "The most constructive way to assist with Brazil's ongoing efforts is in coordination w/ the Brazilian Gov."
Growing evidence suggests large landowners are purposely setting fire to the forest to clear more farmland. One such "day of fire" was coordinated by a group using a messaging app so they could protest current environmental laws and show support for Bolsonaro's plan to loosen restrictions on companies and reverse environmental regulations.
The Ecumenical Forum ACT Brazil condemned Bolsonaro and his administration for policies that "led to a surge in devastation of the environment." The National Conference of the Bishops of Brazil released a statement saying, "This is not the time for instantiates and absurdities in judgment or in speech."
But evangelical Christian groups, about 22 percent of Brazil, have remained silent on the issue.
"Due to their alliance with Bolsonaro, the evangelicals started to oppose the protection of the environment," University of Sao Paulo researcher Renan William said. "They assimilated the idea that environmentalism is a disguise for communists and for international leaders who want to take the Amazon from Brazil."