NSW Attorney-General John Hatzistergos said a recent evaluation of the drug court program in Western Sydney had found it had significantly reduced the rates of reoffending.

The Bureau of Crime Statistics and Research found participants were 17 per cent less likely to be reconvicted for any offence, and 38 per cent less likely to be reconvicted on a drug offence.

"Reducing a person's drug dependence reduces their need to commit crime," Mr Hatzistergos said.

The drug court works by diverting defendants, who are facing jail time for non-violent offences, from the regular court system to receive treatment, be monitored and avoid prison.

"Since 1999, the Western Sydney Drug Court has diverted thousands of drug-dependent offenders into supervised treatment to eliminate their drug dependence," Mr Hatzistergos said.

"Offenders are also subject to strict supervision including regular urinalysis, and those who fail to comply risk being sent to prison," he said.

Participants who do not comply with the program face sanctions, including increased supervision and more regular drug testing.

Mr Hatzistergos said the government had considered basing the Hunter Drug Court at Newcastle but believed it was impractical.

"Under current arrangements it simply wouldn't be possible to run the Hunter Drug Court out of Newcastle without adversely affecting existing court sittings there," he said.

"Once the Newcastle justice precinct is completed, we can reconsider our options."

Toronto courthouse was selected because it had an available second courtroom with chambers, holding cells and other facilities.

Mr Hatzistergos said defendants who faced allegations of sex offences or violence would not be eligible for the program.

Lake Macquarie mayor Greg Piper said he welcomed the prospect of a drug court at Toronto.

"Any reduction in substance abuse is welcome," he said.