Detention of vulnerable women at Yarl's Wood Immigration Removal Centre will end in a pilot scheme announced by Home Secretary Sajid Javid.
The announcement of the trial to MPs comes as a second independent review on immigration detention by Stephen Shaw is published.
Mr Javid said the plans would see women supported in the community instead of locked up in removal centres.
In a statement to MPs, he said: "I can announce today that we intend to pilot a scheme to manage vulnerable women in the community who would otherwise be detained at Yarl's Wood.
"My officials have been working with the UNHCR to develop this pilot which will mean that rather than receiving support and care in an immigration removal centre, the women will get a programme of support and care in the community instead."
Further efforts to soften the system will see a review of time limits for detention in other countries, after criticism from MPs from all parties over immigrants being detained "indefinitely".
Shadow home secretary Diane Abbott said indefinite detention meant people in detention centres were being treated worse than prisoners.
"When it's put to ministers that this system constitutes indefinite detention they say 'no, of course not' but if you are in prison you have a date for release.
"This notion of indefinite detention is one of the things about our current immigration detention system which is the hardest to defend."
She asked Mr Javid if he was aware "how desperate" the women there are, adding: "I do welcome looking at alternatives - working with faith groups, working with the community, care in the community."
Labour's Yvette Cooper, chairwoman of the Home Affairs Committee, said she had heard shocking evidence of "recognised torture victims" still being locked up for "many months" and called for a swift end to the policy.
"The indefinite nature of detention is both traumatising for those who are being held but also means there is no pressure on the Home Office immigration system to make the swift decisions that we need," she said.
Liberal Democrat Home Affairs spokesman Sir Ed Davey said the second report only highlighted the "total failure" of the Home Office to "act swiftly" on the original report recommendations to examine alternatives to detention two years ago.
SNP MP David Linden (Glasgow East) also called for radical reform of detention policy instead of "tinkering".
He said: "The large scale and routine detention of tens of thousands of people in large scale prisons simply for the administrative convenience of the Home Office is an affront to the rule of law and a stain on this democracy."
And Green MP Caroline Lucas (Brighton) also called for an end to the "Kafkaesque nightmare" and "mental torture" of indefinite detention.
Mr Javid earlier said that while the debate on the issue rests "more on slogans than on evidence", he wanted to have a better informed debate and "ensure that our detention policy is based on what works to tackle illegal migration" while being humane.
"Once this review is complete, I will further consider the issue of time limits on immigration detention," he said.
The Home Secretary also announced an immediate end to the practice of having three detainees in a room designed for two.
He said: "I want to see an improvement to the basic provision available to detainees - the practice in some immigration centres of having three detainees in rooms that were designed for two will stop immediately."
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