The charges are the latest twist in a scandal over politicians' expenses that has damaged Britain's ruling Labour and opposition Conservative parties in the run-up to a general election that must take place by June.
In four cases, we have concluded that there is sufficient evidence to bring criminal charges and that it is in the public interest to charge the individuals concerned, said Director of Public Prosecutions Keir Starmer in a televised statement.
He named the four as Elliot Morley, David Chaytor and Jim Devine, who are Labour members of the lower House of Commons, and Paul White, known as Lord Hanningfield, a Conservative member of the upper House of Lords.
Morley is a former environment minister. He faces two charges of dishonest claims for mortgage expenses. Chaytor faces three charges of dishonest claims, while Devine faces two charges for making claims based on false invoices.
The BBC reported that the three had issued a joint statement denying the charges and vowing to defend our position robustly.
White faces six charges, centred on numerous claims for overnight expenses for staying in London when records show he was driven home and did not spend the night in London. He could not immediately be reached for comment.
The four defendants are scheduled to appear in court on March 11. They face a maximum sentence of seven years in jail.
The expenses scandal first broke last year, when details of claims for items ranging from toilet paper to moat cleaning and a duck house dominated the newspapers' front pages for weeks, outraging the public and ending political careers.
The fallout from the row may help a new generation of members of parliament (MPs) emerge from the looming election.
With MPs from all camps tainted, no party has been able to score political points. But many MPs whose reputations were damaged will not run again for fear of being punished by voters.
The Labour Party reacted to Starmer's announcement by saying it had already barred the three MPs facing charges from standing again as Labour candidates.
The Labour Party has zero tolerance for criminal behaviour and will take the strongest possible disciplinary action against any party member found guilty of breaking the law, it said.
While only four legislators face criminal charges, the scandal has tainted several hundred MPs, undermining a once-proud institution that has stood at the centre of British politics for centuries.
An official report released on Thursday found that 390 MPs had filed excessive expense claims between 2004 and 2009 and should pay back a total of over a million pounds ($1.6 million).
Many of the claims were for household items deemed trivial by auditors, but some MPs stand accused of more serious abuses such as flipping, or changing which house they declared as their main home in order to maximise second home allowances.
(Editing by Keith Weir and Philippa Fletcher)