Five teenagers have needed hospital treatment this week after swallowing what police believe are tabs of LSD.
Police said the small pieces of black paper with a red flash design were circulating in Colburn, near Catterick.
North Yorkshire Police said it was trying to identify the source of the drug and was "extremely concerned" others may take it.
It said the drugs were "inherently dangerous" particularly when taken with other substances, including alcohol.
Insp Mark Gee said: "Illegal drugs often contain different substances, making it impossible to visually identify what they are, or how strong they are.
"The effects of this hallucinogenic can be strong, unpredictable and overwhelming to the user, as seen with the hospitalisation this week of a number of young people locally."
Anyone taking drugs who becomes unwell, should seek medical attention as soon as possible, he added.