International backpackers are risking life and limb by staying in overcrowded, unhygienic and unsafe illegal hostels, a new report has found.

The study, commissioned by the backpacker industry and released by the Australian Tourism Export Council (ATEC), uncovered dodgy operators throughout Sydney, Melbourne and Brisbane.

ATEC managing director Matthew Anergy said these illegal operators were stealing from both the industry and the government through failure to pay GST, compliance fees, rates and stamp duty.

"In many cases they are placing backpackers at risk through unhygienic, overcrowded premises which don't adhere to fire or other safety regulations," he said.

ATEC's Backpacker Tourism Advisory Panel chairman Julian Ledger said the operators were luring backpackers using advertisements in magazines and at known backpacker hangouts.

Backpackers 'risk lives', continued