People in 16-18 education will get free bus passes to their place of study if they live in any London borough and as long as the college or training centre is in the capital.
Last week, an FE Focus and Learning and Skills Network survey revealed fears that teenagers would be excluded from further education because of travel costs.
Withdrawal of subsidies by local authorities around the country has meant provision is patchy, with colleges in some cases having to find money to help individual students from low-income families. The London scheme is available regardless of a student's financial circumstances or family income.
Mr Livingstone claims popular support among Londoners for the subsidies - after a poll showed eight in ten were in favour of the students getting free transport. It is expected that 130,000 people will benefit.
The Mayor of London said: "It is a huge boost for individuals striving to continue studies and will help those who might drop out of education through lack of money."
Application forms for the free travel will be made available through colleges, as well as post offices and schools. The scheme is available to 16 and 17-year-olds living permanently in a London borough, as well as 18-year-olds who apply before the end of the academic year in which they turn 18.
Applicants must be in full-time education - defined as 12 hours of guided learning per week for a minimum of ten weeks, or unwaged training. Students over 18 will be able to get a 30 per cent discount on tube and bus travel.
Jenny Lo, regional director for the Association of Colleges in London, said: "Many of the students come from disadvantaged families, and removing the cost of travel will also help those in research or vocational projects get to and from libraries or work-based training and learning places that will help them with their studies."