The deal between ITV HomeChoice-owner Video Networks will give subscribers the branded London Tonight programme, a weather service and a search facility of classified listings for concerts and films.
ITN will provide news feeds for the channel and viewers will also be offered the chance to contribute editorial material.
Clive Jones, chief executive ITV News, said: “As an organisation ITV is committed to taking the lead when it comes to delivering valued and cutting edge public services to our viewers.
“The delivery of entertainment via a broadband connection will change the way we watch television and reinvent what the viewer can actually do with content, as this new channel illustrates.
“The new freedom that can be exercised by the viewer because of broadband delivery makes really local news possible for the first time.”
BBC News 24 and Sky News Active currently broadcast looped news, sport and weather summaries, but it is believed the ITV deal is the first time a national broadcaster has agreed to provide local news reports on a dedicated channel.
Hugh Williams, executive director of programming at Video Networks, said: “With television shows being delivered down a phone line via a broadband connection it’s safe to say that the future of TV is already happening in London.
“Although VNL is a commercial company, we have always been committed to delivering services of public value.
“We believe that the on-demand functionality our service allows means the opportunities for local interest programmes within local communities are, for the first time, a reality.”
By Kevin May