Up to 2,000 part-worn tyres - many of which are suspected of being illegal and possibly dangerous - are being brought into Northern Ireland each week and sold on to unsuspecting motorists.
Most of the tyres come from Germany and are being sold as reliable goods.
But many fail to comply with current legislation and others are potentially life-threatening.
Part-worn tyres have been used previously and removed from another vehicle.
They may have been punctured, taken from a vehicle written off in an accident or replaced because of signs of ageing.
The National Tyre Distributors Association (NTDA) has now called on local authorities to improve regulation within the industry to try to stop the sale of dangerous, sub-standard tyres.
The Tyre Industry Council - the UK's leading tyre safety organisation - also said that part-worn tyres are a cause for concern.
A 2010 survey by the NTDA found that 95% of used tyres being sold were illegal because they were not marked as part-worn.
NTDA spokesman Barry Douglas said that Northern Ireland motorists could be putting their lives at risk by purchasing tyres that are not fit for purpose.
"There is a real problem with tyres not being sold properly and legally and in some cases part-worn tyres are being sold without the knowledge of the person buying them," said Mr Douglas.
"A lot of these tyres are winter tyres and 95% of those being sold at the moment simply don't comply with legislation."
A brand new tyre costs around £45, whereas a second-hand - or part-worn - tyre can be purchased for as little as £10, making them attractive to consumers.
Mr Douglas said the illegal part-worn tyre racket is costing the car industry £3m each year, while the VAT alone amounts to £500,000.
Jonathan (23) from Newtownabbey, who didn't want his surname used, unwittingly bought an illegal, life-threatening tyre.
"I bought a part-worn tyre from a dealer last week and I took it to a garage to get my wheels aligned.
"The experts there told me the tyre wasn't roadworthy, so I took it back to the supplier, who gave me another tyre - but the second tyre turned out to be twice as bad as the first one.
"If it had blown up when I was driving I could have been killed and so could others."