The billboard, for UK TV Style's 'Extreme Makeover: Home Edition', propgramme bears the strapline "Bless this Crack House" in a framed floral cross-stitch picture.
One poster site in particular has been singled out for condemnation -- opposite St Matthew's Roman Catholic Church in West Norwood in South London.
Condemning the ad, the leader of Lambeth Council, councillor Peter Truesdale said that the campaign should be stopped.
"Crack houses should be closed down, not glorified on billboards.
"We have a zero-tolerance policy on crack houses and this kind of advertising is poking fun at the work of the council and police," he said.
The council said it was also considering a complaint to the Advertising Standards Authority about the ad.
According to Lambeth's deputy leader Cllr John Whelan: "No self-respecting advertising agency should use this kind of messaging, even if it is misguided tongue-in-cheek humour.
"Crack houses are a serious matter across Lambeth and this form of advertising is highly offensive and in no means funny for passersby, faith groups, and residents of the borough."
The campaign includes two other executions. One uses the strapline "There's no place like home for a gangland slaying" appearing on a floral patterned cushion background. While the third ad uses the line "Home Sweet Derelict Trailer Park" against a heart-shaped wooden sign hanging on a wall.
'Extreme Makeover: Home Edition' is broadcast on UK TV Style weeknights throughout June.
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