A bug called a psyllid will be used to fight against the non-native plant, which is listed by the World Conservation Union as one of the world's 100 worst invasive species.
Currently, it costing the UK economy over £150 million a year to control and clear the weed, which grows at a rate of up to a metre a month.
It can push through tarmac, concrete and drains and destroys habitats for native species.
Wildlife minister Huw Irranca-Davies said: "These tiny insects, which naturally prey on Japanese Knotweed, will help free local authorities and industry from the huge cost of treating and killing this devastating plant."
It follows the launch of another government campaign last month, which aims to highlight problems with non-native garden pond plants.