Residents and visitors are now able to park free of charge for a maximum of 20 minutes in seven designated bays to give them time to use local facilities and businesses.
Two spaces are for blue badge holders and five for general use.
The idea was put forward by the Helmsley in Business group and given the go-ahead by Ryedale District Council.
Although all drivers will still need to get a ticket from the machine, as long as they stay 20 minutes or less no payment will be required.
It is hoped the new spaces will stop cars parking dangerously and illegally at the end of Borogate to go to the shops and Post Office, blocking access, or in the side streets around the town centre.
Helmsley is now being used as a model for other wards and towns across the district in the “town team” approach, designed to take action quickly to make multi-agency improvements where possible.
As with all off-street parking in Helmsley, use of the spaces will be patrolled and enforced by Scarborough Borough Council between 8am and 6.30pm.
Carolyn Frank, chairwoman of Helmsley in Business and owner of Libby Butler Jewellers, said: “We’ve been talking about this idea for a long time. Residents were always telling business owners that the price of parking for an hour was putting them off popping in to a local business when they don’t need very long to post a parcel, buy something for dinner, return a library book, pop to the public toilets, buy a newspaper and so on.
“So we began talking to Ryedale District Council about a solution to help in these situations. Hopefully this will free up more spaces in general for parking, as there’ll be a quicker turnaround so it will be easier to find a space without a wait.
“We are always looking for ways to improve our wonderful town and along with this great new parking initiative, we also welcome the introduction of a community officer for Helmsley by Ryedale District Council.”