"I am directing our House committee to open a formal impeachment inquiry into President Joe Biden," McCarthy said, alleging that the Democratic president had lied to the American people about his son Hunter's foreign business dealings.
"House Republicans have uncovered serious and credible allegations about President Biden's conduct," McCarthy told reporters. "Taken together, these allegations paint a picture of a culture of corruption."
The business dealings in Ukraine and China by Biden's 53-year-old son Hunter while his father was vice president under Barack Obama have been a constant target of Republicans.
Hunter Biden, a recovering drug addict, is currently under investigation by a Justice Department special counsel for possible tax evasion and is expected to be charged by the end of this month on a firearms violation.
However, he has not been charged with crimes related to his foreign business dealings and no credible evidence has emerged so far that the president was involved in anything illegal.
McCarthy has been under pressure from the right-wing of the party, loyal to Donald Trump, for months to open an impeachment inquiry into the 80-year-old Biden.
The White House immediately condemned the move, calling it "extreme politics at its worst."
"House Republicans have been investigating the President for 9 months, and they've turned up no evidence of wrongdoing," Ian Sams, White House spokesman for oversight and investigations, said on X, formerly known as Twitter.
US House Speaker opens inquiry into Biden for 'meddling' in son Hunter's business affairs
'Abuse of power'
Under the US Constitution, a president can be impeached for "treason, bribery or other high crimes and misdemeanors."
McCarthy, who was forced to compromise with the far-right of the party to win his powerful speaker's post, said the "allegations of abuse of power, obstruction and corruption" against Biden "warrant further investigation by the House of Representatives."
Democratic lawmakers have denounced the move as a purely partisan exercise intended to exact revenge for the double impeachment by the then Democratic-controlled House of former Republican president Trump.
A number of moderate Republican members of the House and the Senate have also expressed skepticism about launching an impeachment investigation into Biden.
Trump, the frontrunner for the 2024 Republican presidential nomination, is to go on trial in Washington in March on charges of conspiring to overturn the results of the November 2020 election he lost to Biden, the likely Democratic nominee in next year's White House contest.
Trump was also impeached twice by the House while in office, once for seeking political dirt on Biden from Ukraine and a second time for the January 6, 2021 assault on the US Capitol by his supporters.
He was acquitted by the Republican-majority Senate both times.