Irish holidaymakers took 3% of overnight island breaks in N Ireland in 2016
Irish holidaymakers took just 3% of their overnight trips on the island north of the border last year, a report revealed.
Republic residents made five million overnight holidays on the island, spending £942 million.
The weakening of sterling prompted a recent bounce in performance for business in Northern Ireland. But higher VAT and a lack of "must see" attraction has contributed to a decline in recent years, a report for Tourism NI said.
Its review said: "Northern Ireland is consistently outperformed by Republic of Ireland on most of the key motivating short break activities (shopping, nightlife, enjoying the natural environment, engaging with locals).
"Importantly, Republic of Ireland consumers rate Republic of Ireland as offering better places to eat and stay - two key drivers of decision-making in choice of a short break destination.
"In essence, Northern Ireland faces a more mature and strong key competitor in Republic of Ireland."
It said the active promotion of Northern Ireland as a destination by its industry to customers in the Republic was limited.
"Republic of Ireland industry are far more focused and engaged in heavyweight promotion of their propositions to domestic consumers.
"There is a challenge to create more awareness of Northern Ireland generally, placing Northern Ireland into the consumer's mindset as a compelling alternative to a Republic of Ireland break."
The purchasing power of the euro consistently weakened over 2012-15 against the pound, making Northern Ireland a relatively expensive destination.
Recent currency movements have resulted in the strengthening of the euro, delivering improved performance, the report said.
It said knowledge about Northern Ireland was low south of the border.
"There is a perceived lack of 'must see and do' attractions and a sense that the short break holiday experience in generally is underdeveloped."
Concerns about personal safety, although minimal, remain present and linger in the Irish consumer's mind, acting as a deterrent to consideration and planning.
There has been a "very significant" decline in Tourism Northern Ireland's campaign budget in recent years.
Tourism NI chairman Terence Brannigan said: "In the first half of this year alone Tourism NI's Say Hello To More marketing campaign helped deliver 221,000 overnight trips by Republic of Ireland residents to Northern Ireland, contributing £40 million to the economy.
"While we have experienced growth in recent years, progress has been sporadic in our closest-to-home export market.
"We also face a strong competitor in the Republic of Ireland as a destination."