Heroin users in Middlesbrough will be allowed to self-administer drugs at a new clinic.
Cleveland Police said the scheme targets the most prolific offenders to break the cycle of drug use, crime and prison.
It will cost £12,000 per addict and also see them helped in other ways.
The force estimates a core of 20 drug-dependent offenders in the city have cost the public £784,000 over the last two years on detected crimes.
Similar trials in London and Darlington previously suggested such schemes reduce crime and drug use but they were criticised by campaigners Europe Against Drugs who said it "perpetuates addicts' maintenance on the drug when the goal should always be abstinence".
The Middlesbrough plan will also see various agencies focusing on the most prolific offenders to provide medical, housing and other assistance to "finally get users off drugs, off the streets and back into society".
Cleveland Police and Crime Commissioner Barry Coppinger said: "It's clear that for a small group of addicts the current strategies are not working and if we don't try something new the cycle of offending and the enormous costs to society will simply continue and, in all likelihood, increase.
"For a fraction of the cost of their offending we can give these people hope and a chance to turn their lives around, protect the public and local economy and free up vital NHS and police resources currently devoted to dealing with this small group."
At the new Injectable Opioid Treatment clinic, users will be able to self-administer under supervision three times a day.
Columnist and writer Peter Hitchens told BBC Tees drug users are criminals and should not be treated as people with an illness.
"The whole idea that people who take drugs are sufferers and victims rather than the imposers of wickedness on other people is a grave mistake," he added.
Mr Hitchens said drug users should be punished as soon as they break the law.
Barry Woodward, a former drug addict and dealer, said the scheme was "really exciting", and added: "Some people will abuse that but some people will make good use of it."
Tina Williams, from Stockton-based Bridges which supports families of people with drug problems, said she would "applaud" the initiative.
"Hopefully it will bring about fewer deaths, less crime and fewer problems in our communities."