It is reported that the experiment, known as Checkpoint, allows criminals convicted of offences such as burglary and assault to avoid prosecution if they complete certain rehabilitation programmes.
The first results of the trial, which tracked 519 offenders over two years, found a 15% drop in reoffending for those who took part in the initiative compared with those who chose not to participate.
Only 6% of the 2,660 offenders involved in the trial have reoffended.
At least five other police forces, including Surrey and Cornwall, are believed to be considering introducing the scheme.
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The results are part of a University of Cambridge study into whether so-called "soft justice" initiatives are successful in reducing crime and cutting costs.
Durham Chief Constable Jo Farrell told The Guardian newspaper that the scheme was aimed at helping break "the cycle" for people charged with low-level offences such as shoplifting or drug possession.
"This isn't about trying to do things on the cheap or divert people away from court or prison," she said.
"It's a cohort of people for whom this cycle will never end unless we do something different."
Although it costs the Durham force £480,000 a year, it is estimated that it saves at least £2m a year in reduced crime for every 1,000 offenders.
Sophie Gregory, the criminology course director at Birmingham City University, said Checkpoint's results were a significant step forward in changing the way the justice system tackles low-level crime.
"We know that around two-thirds of women and a third of men are reportedly committing crime to fund addictions, so if we can go back to that root problem and help with some tailored support long term it has got to help reduce reoffending," she said.
The Checkpoint programme is due to be discussed at the National Police Chiefs' Council later this month.