It will be tested in parts of London where some criminals will face a drinking ban and be fitted with a tag that detects any alcohol in their sweat.
It's hoped the scheme will cut crime committed by people under the influence of alcohol, which costs the UK up to £13 billion a year.
The Justice Secretary says he'll be monitoring the pilot to see if it helps reduce re-offending.
Chris Grayling said: "It allows the courts to say, you've got a problem with alcohol, if you don't follow this programme, if the evidence from that tag is you've just been ignoring it, then we'll bring you back before the court and find a different punishment for you."
Around 150 offenders could be made to wear the tags for four months to ensure they comply.
Mayor of London, Boris Johnson, has given his support to the trial. He told the BBC: "Alcohol-fuelled criminal behaviour is a real scourge on our high streets, deterring law-abiding citizens from enjoying our great city, especially at night, placing massive strain on frontline services, while costing businesses and the taxpayer billions of pounds.
"I pledged to tackle this booze culture by making the case to government for new powers to allow mandatory alcohol testing as an additional enforcement option for the courts." He said.
The Office of National Statistics says around 880,000 of the violent offences in England and Wales in 2012-13 were linked to alcohol or drugs.
Marolin Watson from Christian alcohol support charity Hope UK told Premier's News Hour it's a good idea: "It appears to be working in American and it's one way of dealing violent crimes linked to alcohol.
"I think if they're going to face penalties if they do continue to drink it ought to be a deterrent."
Hear more from Marolin Watson here or on News Hour catch up: