The country’s largest supermarket chain will trial the scheme in Streatham, south London, where it is building 250 flats next to its store.
Tesco says that if the trial is successful it is likely to include staff housing in further developments.
It is understood that more than 100 of the 250 flats will be let at affordable rents, with 13 reserved for Tesco staff.
A housing association will manage the sale of the flats. Tesco staff who rent the properties will be treated no differently from other tenants and will not have to vacate the properties if they leave their supermarket jobs. The Streatham development will also include a leisure centre and ice rink.