The Swede, who guided the nation into the quarter-finals of the 2002 and 2006 World Cups and also at Euro 2004, is confident the current crop of players can improve on that, provided they head for Poland and Ukraine fit and fresh, and manage to avoid reigning World and European champions Spain in the quarter-finals.
Asked about England's prospects, Eriksson told BBC Radio 5Live's Sportsweek show: "I think they have a big possibility to be in the semi-final or final. Why not win it?
"With a little bit of luck, not a lot of injuries and the players not too tired, they have a chance, absolutely."
England would, of course, first have to negotiate their way out of Group D, in which they will meet France, Sweden and co-hosts Ukraine, with the recovering French perhaps representing their toughest test.
Eriksson said: "They (France) have changed everything since the last World Cup and things are going very well for them, so I think they will do much better this time than they did in the World Cup.
"It's tough, but the squad England will have out there is very strong, so if England don't have a lot of injuries, if they are not too tired - which always is a big issue, of course - they are the strongest team.
"They should be the strongest team in the group. They should go through to the quarter-finals and I am quite sure they will do that."
Should they succeed in reaching the quarter-finals, most commentators have predicted a last-eight clash with either Spain or Italy, although Group C rivals the Republic of Ireland may have something to say about that.
Eriksson said: "Let's hope it's going to be Italy. Spain, as we all know during the last years and the last two big tournaments, they have been outstanding.
"They have been for years now the best team in the world, so let's hope it's going to be Italy.
"If it was Spain, if Spain perform like they have been lately, probably England would not be the favourite, so that's good in one way.
"If it's Italy, England could be the favourite there."
Capello's reign will end this summer regardless of what happens at the finals, leaving the Football Association with the task of finding his successor.
However, Eriksson believes the right man is under their noses in the shape of Tottenham manager Harry Redknapp.
He said: "I would say Harry Redknapp is a very, very good choice. Of course, there are others, but Harry is English and if the FA wants an Englishman, I think he's the perfect one."