Drug Intelligence Assistance Act of 1989 - Amends the Omnibus Crime Control and Safe Streets Act of 1968 to authorize grants to States, cities, and units of local government to establish local and regional drug intelligence units.

Specifies the uses of such grants as the establishment, maintenance, and improvement of antinarcotics and money laundering intelligence units at the State and local level and the enhancement of State and local efforts to apprehend and prosecute significant narcotics trafficking or money laundering operations, including individuals involved in youth gangs engaged in such activities.

Provides for the allocation and distribution of funds under formula grants to States, cities, and units of local government based on population and giving priority to those jurisdictions with the greatest need. Authorizes appropriations.