In the face of a growing number of deaths and cases of HIV linked to drug abuse, the Portuguese government in 2001 tried a new tack to get a handle on the problem—it decriminalized the use and possession of heroin, cocaine, marijuana, LSD and other illicit street drugs. The theory: focusing on treatment and prevention instead of jailing users would decrease the number of deaths and infections.

Five years later, the number of deaths from street drug overdoses dropped from around 400 to 290 annually, and the number of new HIV cases caused by using dirty needles to inject heroin, cocaine and other illegal substances plummeted from nearly 1,400 in 2000 to about 400 in 2006,  according to a report released recently by the Cato Institute, a Washington, D.C, libertarian think tank.

 "Now instead of being put into prison, addicts are going to treatment centers and they're learning how to control their drug usage or getting off drugs entirely," report author Glenn Greenwald, a former New York State constitutional litigator, said during a press briefing at Cato last week.

Under the Portuguese plan, penalties for people caught dealing and trafficking drugs are unchanged; dealers are still jailed and subjected to fines depending on the crime. But people caught using or possessing small amounts—defined as the amount needed for 10 days of personal use—are brought before what's known as a "Dissuasion Commission," an administrative body created by the 2001 law.

Each three-person commission includes at least one lawyer or judge and one health care or social services worker. The panel has the option of recommending treatment, a small fine, or no sanction.

Peter Reuter, a criminologist at the University of Maryland, College Park, says he's skeptical decriminalization was the sole reason drug use slid in Portugal, noting that another factor, especially among teens, was a global decline in marijuana use. By the same token, he notes that critics were wrong in their warnings that decriminalizing drugs would make Lisbon a drug mecca.

"Drug decriminalization did reach its primary goal in Portugal," of reducing the health consequences of drug use, he says, "and did not lead to Lisbon becoming a drug tourist destination."

Walter Kemp, a spokesperson for the United Nations Office on Drugs and Crime, says decriminalization in Portugal "appears to be working." He adds that his office is putting more emphasis on improving health outcomes, such as reducing needle-borne infections, but that it does not explicitly support decriminalization, "because it smacks of legalization."

Drug legalization removes all criminal penalties for producing, selling and using drugs; no country has tried it. In contrast, decriminalization, as practiced in Portugal, eliminates jail time for drug users but maintains criminal penalties for dealers. Spain and Italy have also decriminalized personal use of drugs and Mexico's president has proposed doing the same. .

A spokesperson for the White House's Office of National Drug Control Policy declined to comment, citing the pending Senate confirmation of the office's new director, former Seattle Police Chief Gil Kerlikowske. The U.S. Drug Enforcement Administration (DEA) and the U.S. Department of State's Bureau of International Narcotics and Law Enforcement Affairs also declined to comment on the report.