A spokesman from the German ministry of the environment said on Tuesday that the private companies running the country's 18 nuclear power stations had got together to develop the unique defence tool.
They were proposing "a protection concept made up of fog-making machines that are capable of hiding the installations in a few seconds," the ministry said in a statement.
"The probability that a plane could be aimed precisely at the reactor would be very efficiently reduced," the statement added.
The smoke screen concept is a response to a report commissioned by the German government in the wake of the September 11 attacks on the United States which examined the vulnerability of its nuclear plants to attack from the air.
According to the report, a copy of which was obtained by the German daily Suddeutsche Zeitung, the situation was shown to be "alarming."
"None of the German reactors is protected against a plane crashing on to it, the result of which would be nuclear catastrophe," the report said.
According to the British magazine New Scientist, commercial passenger aircraft are not equipped with the kind of radar that would make it possible for them to locate buildings on the ground.
"The feasibility study for this idea, which is unique in the world, will probably be completed by March," the ministry spokesman said.
On Sunday the environment ministry said it had bought 137 million potassium iodide tablets to protect people living near nuclear power plants from radiation exposure in case of disaster.
Potassium iodide is thought to protect the thyroid gland from absorbing radiation.