Drug diversion has become a popular policy intervention used for responding to illicit drug users in Australia. Much of the drug diversion programs focus on cannabis, a drug used by 33% of Australians (Australian Institute of Health and Welfare, 2008) and that accounts for 74% of illicit drug offences (Australian Crime Commission 2006). Drug diversion aims to reduce future drug use (through educating and/or treating drug use), increase the efficiency of the criminal justice system and reduce the costs of responding to drug use. Yet there is limited understanding to date on how to improve the designs of drug diversion systems and to facilitate the best possible outcomes. This paper provides an overview of a system dynamics model of cannabis diversion in Australia. It models all existing responses to cannabis users, (i.e. cannabis diversion programs and traditional court responses) and their impacts on future crime and the cost to the criminal justice system. The model can be used to examine a number of different policy scenarios: changing the number of cannabis users diverted, the type of programs used, improving the effectiveness of cannabis interventions or removing breach conditions for diversion programs. The results from the scenarios will be presented along with the implications for improving cannabis diversion systems.