The division will be based in London and is being run in partnership with Freeserve's parent Wanadoo, German portal Web.de and Italian portal Librero.it, which will contribute staff and resources.
Freeserve has already signed up a number of pan-European advertisers for the network, including Visit London and Intercontinental Hotels, which are both running online campaigns.
According to Dave McCall, Freeserve's ad sales director, the network will target a market worth more than 1bn euros (£696m).
The launch of the network comes as Freeserve prepares to rebrand to parent Wanadoo and is the latest phase of integration into the French company by the ISP.
Freeserve is not alone in offering pan-European ad sales solutions. Rivals MSN and Yahoo! have also set up dedicated teams for the region.
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