Three quarters of music tracks downloaded this year were done so illegally.
The BPI research found that 1.2 billion digital tracks were downloaded illegally this year – more than the volume of individual tracks ever downloaded legally in the UK, which is around 1 billion.
The BPI said the illegally downloaded tracks had a retail value of £984m.
It added that sales of digital singles could top £160m this year, above last year’s £149.7m.
Harris Interactive research, commissioned by the BPI, found that almost one in three Brits with internet access aged between 16 and 54 are engaged in some form of illegal downloading.
BPI chief executive Geoff Taylor called on Government to intervene.
He said: “Digital music is now mainstream in the UK, with much to be proud of – nearly 70 legal services and a further increase in the numbers of digital singles and albums set to be sold online in 2010.
“Yet this growth is a fraction of what it ought to be. Illegal downloading continues to rise in the UK. It is a parasite that threatens to deprive a generation of talented young people of their chance to make a career in music, and is holding back investment in the fledgling digital entertainment sector.
“The creative industries employ two million people in the UK and are the fastest growing sector of the economy. Urgent action is needed to protect those jobs and allow Britain to achieve its potential in the global digital market. 2011 must be the year that the Government acts decisively to ensure the internet supports creativity and respects the basic rules of fair play we embrace as a nation.”