Youth justice and further education officials hope that the pilot project, operating in London, the south east and the east of England, will provide a blueprint to prevent reoffending across the country.
Education and training charity Rathbone will work with more than 100 teenagers in three young offender institutions: Feltham in south London, Huntercombe in Oxfordshire and Warren Hill in Suffolk.
During the six-month pilot, tutors will be working full-time on skills training in the classroom and community workers will be on hand to help young offenders after they have left prison.
The scheme is jointly funded by the Youth Justice Board and the Learning and Skills Council and is aimed at reducing the reoffending rate among teenage criminals.
At the moment, more than two-thirds commit another crime within two years of release. Fewer than one in six leave custody with any employment or training prospects. Richard Williams, chief executive of Rathbone, said:
"Young offenders leaving custody need information and support to give them the chance to turn away from offending behaviour - especially when they are returning to the same environment and social circle.
"With so many young people re-offending within a short time frame, there is obviously a pattern that needs to be broken."