Summary About 1,000 jobs in education, a quarter of its total workforce-are being cut.
Civil servants losing their jobs will be made redundant within two years, as the DfE focuses on priority work.
The DfE was making administrative cuts of 42% by 2014-15 - but following a review ordered in June, the cuts have been raised to 50% (£290m) by 2015-16.
The news was announced to staff on Tuesday, prompting concern from unions.
BBC political correspondent Carole Walker says Education Secretary Michael Gove has gone further than any of his Cabinet colleagues in slashing the costs of running his department and this will increase the pressure on other ministers to follow suit.
Whilst all departments will have to find savings of about a third by the next election, Mr Gove says he will halve his administrative costs by the year 2015-16.
Regional offices close
Six regional offices of the DfE will be closed as the department is streamlined.
The department will need to identify which areas of work will be abandoned”
"The review has put forward proposals that will reduce the number of sites from 12 to six, maintaining a single site in central London, Coventry, Sheffield, [north-east and north-west England] and Nottingham.
"These proposals would generate savings of around £15m per annum."
The review report says decision-making at the DfE is often "slow and laborious", with "unclear roles and processes".
It says new ways of working will remove "the barriers which sap energy and prevent people being as effective as they can be so that less time is wasted on activities which add little value".
It adds: "Too often at present new work ends up on the desk of somebody based on their job title rather than the skills they have, and existing work is not de-prioritised to free up resources to deal with a new pressure."
The department s work must match ministers priorities more closely in future, it says.
A spokesman for the DfE said: "We conducted a review to make sure we have the capability to deliver well-designed policies that have a real, measurable impact on the children and young people who need it most, while minimising costs to the taxpayer.
