Prisoners given life or indefinite sentences should have the chance to seek release before the end of their minimum term, according to campaigners.
The Howard League for Penal Reform called for a "faint hope" law to be introduced.
It would enable those given open-ended punishments, who make an "exceptional effort" to rehabilitate themselves, to apply for earlier parole eligibility.
Those handed life or indeterminate sentences are given a minimum term - also referred to as the tariff - which they must serve in full before becoming eligible to apply for parole.
Release at the end of the tariff period is not automatic, however, and prisoners can remain behind bars for many more years.
The Howard League claimed its proposal would "reward progress and save the taxpayer millions of pounds".
Frances Crook, chief executive of the charity, said: "Prisoners should be incentivised to change their lives and reform, and the system has to be flexible and able to reward their efforts through earned release.
"Otherwise, what hope do they have?"
The proposal would mirror a section of the criminal code in Canada which became known as the "faint hope clause".
It allowed offenders who are serving life with a minimum term of more than 15 years to apply for early parole once they have served 15 years.
Under the clause, which has been abolished, applicants' progress in prison could be reviewed by a jury.
A Howard League briefing paper said: "Theoretically, any person serving life with a minimum tariff of 15 years can apply for a jury to consider their case.
"However, in practice the majority of lifers who have not made efforts to rehabilitate themselves or have a poor record of behaviour in prison do not apply.
"All applications go through judicial pre-screening and only those judged as having a reasonable prospect of success proceed to a full jury hearing."
The paper also claimed there are more people sentenced to an indeterminate term in England and Wales than in the other 46 countries in the Council of Europe combined.
The most recent official statistics said 11,675 prisoners were serving indeterminate sentences, which include life sentences and Indeterminate sentences for Public Protection (IPPs).
IPPs were abolished for offenders convicted on or after December 3 2012. However, the change was not retrospective and did not apply to those already serving the sentences.
A Ministry of Justice spokeswoman said: "Protecting the public will always be our top priority and it is right that those who have committed serious crimes - including rapists, murderers, child abusers and gang leaders - are held in prison for a substantial period of time.
"At the same time, most of these offenders will be let out at some point in their lives, so it is vital that we protect the public by making sure they are less likely to commit more crime and create more victims on release.
"Our reforms will improve rehabilitation so that reoffending falls, crime is cut and public safety is improved."