The mayor of the Estonian capital, Tallinn, has said that the city will offer free public transport across its bus and tram network from 2013.
Officials say that three-quarters of those who voted in a referendum backed the idea, part of an attempt to make the city one of the greenest in Europe.
But critics have said the move is politically motivated and a poor use of public funds.
Ticket sales cover only 33% of the costs of running the transit network.
Mayor Edgar Savisaar said that Tallinn was the first city in Europe to take such a step, which would make it "the flagship of green movement in Europe".
Tallinn officials said some 68,000 people supported the move, in a week-long vote that involved polling stations being set up in the city's shopping centres and community halls.
But only a fifth of those eligible to vote in the city's population of 416,000 actually took part in the poll.
The opposition Reform Party said it was outrageous that the referendum had cost 260,000 euros to hold.
"The outcome was known from the start," Valdo Randpere, the party's deputy chairman said, according to Baltic Business News.
"Tallinn seems to be one of the richest cities in the world, but for some reason its streets are filled with pot-holes and there is no money for kindergartens," he added.
Critics see the move as a waste of public funds and an attempt by Mr Savisaar to win popularity for his centre-left Centre Party, part of the opposition in the national parliament.
Estonian media report that the proposal would cost an estimated 20m euros, but city officials argue that it would reduce the use of private vehicles in Tallinn.