From the end of August, inspection reports for YOTs will be handed grades of "outstanding", "good", "requires improvement" or "inadequate".
Under an inspection overhaul by HMI Probation, each YOT will be measured against a revamped set of standards, which were developed earlier this year to help improve performance and better measure how they are helping to improve young people's lives.
YOTs will receive a grade in each of four categories of governance and leadership, staff, partnerships and services, and information and facilities, as well as for overall effectiveness.
None of these categories are weighted in terms of judging a YOT's overall effectiveness.
To achieve an outstanding rating YOTs will need to show they are innovative and creative, proactive, open and transparent, supportive and inclusive and can respond to trends and collaborate well with local partners, says HMI Probation guidance.
A service is at risk of being rated as inadequate if it is "solely reactive, defensive and blaming, characterised by division and conflict, unresponsive and inward-looking", adds the guidance.
Chief inspector of probation Dame Glenys Stacey said: "Our underlining philosophy here is that ratings that are well evidenced and underpinned by good standards will drive improvement, where improvement is needed.
"We know from research that's the case and if we can identify specifically enough for those that we inspect and rate where they need to improve they can make improvements in those areas and hopefully aim for a better rating next time."
In its annual report HMCFRS has confirmed that it will also be using the new grading system in its inspections of YOTs and is particularly keen to help improve information sharing between teams and police forces as well as responses to child sexual exploitation.
"We found that the police are generally committed to preventing young people from re-offending," states the report.
"However, in some cases, they could do more to share information with other agencies. This happens most effectively when police officers work within youth offending service (YOS) arrangements or local youth offending teams, alongside other staff.
"We were also concerned that some police officers working in YOSs hadn't had enough training in multi-agency public protection arrangements and how to respond to child sexual exploitation.
"Together with HMI Probation, we are now revising our joint inspection programme, and will start using a new methodology in 2018/19.
"Changes will include a formal assessment of how the agencies involved in YOSs work together, and a new system that will grade YOSs from outstanding through to inadequate."
The last major overhaul of YOT inspections was in 2012, when HMI Probation reduced the number of full inspections from more than 50 a year to just six.