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Tracking devices will be secured in a new lockable collar made from an anti-cut material.
Owners will receive a text message if their dog goes beyond a pre-determined boundary.
They can then log onto a website which will show the dog's precise location, even if the animal is inside a building.
It is the first satellite-tracking system to be incorporated into a dog collar and is aimed at preventing the ever-increasing crime of dog-theft.
No precise figures are kept on the number of dogs stolen in the UK as they are not logged by police or the Home Office, but campaigners say it runs into many thousands each year.
The collars will use three tracking devices - satellite, telecom and radio frequency.
"Dog theft isn't high on police priorities, for obvious reasons, " said Andrew Stewart, director of Rerieva, the company behind the new product.
"But for owners and families, if a dog gets lost it really is a traumatic experience," he said.
The collar, which was launched at this week's Crufts Dog Show in Birmingham, is due to go on sale in July at £200, plus a monthly fee.
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