The market, which was closed because of the snow for two weeks after Christmas, will not now reopen. Letters have gone out to all stallholders explaining the reasons behind the decision.

The market, which has been operating since the early 1990s, attracts up to 1,000 stallholders every week.

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But in recent years it had become the focus for organised criminal activity, including the sale of counterfeit music, DVDs and clothing.

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In a bid to tackle the problem, the council, police and Trading Standards mounted a number of pro-active operations at the site, including issuing permits and a trader registration scheme. However, despite arrests and subsequent convictions it has not solved the issue.

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The scale of the problem and the nature of the site means the measures have made little difference and closure was the only option.

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Councillor, Les Carter, Leeds City Council's executive board member for community safety and the chairman of Safer Leeds said: "I'm saddened that we have had to take the decision to close Cross Green market but the level of counterfeit and stolen goods being traded there left us with little choice. Over the past year we have worked closely with the police and trading standards officers to try and deal with the issue but the problem persists.

"I'm afraid the criminal minority has managed to spoil things for the vast majority of law-abiding people.

"It should also be noted that people were coming from other parts of the country to take part in this illegal trading.

"Leeds has a thriving market culture and we will continue to do all we can to support that but illegal traders must understand that we will always take action against illegal activities."

Superintendent Simon Whitehead from Safer Leeds, the city's crime reduction partnership, said: "It is unfortunate that a decision to close Cross Green Market has had to be taken but the manufacture and sale of counterfeit goods is a serious issue and has a significant element in organised crime.

"Working alongside Leeds City Council and FACT (Federation Against Copyright Theft) we have taken every step possible to combat this matter.

"The sale of counterfeit music and films may seem appealing but the profits from these goods is used to fund organised crime and by purchasing these products people may be unwittingly helping to fund high level criminality like drug dealing and people trafficking.

"I would urge anyone who is offered these types of goods to realise what truly lies behind this type of crime and to report anyone selling these products to local police via: 08456 60 60 606 or call
Crimestoppers anonymously and in confidence via: 0800 555 111."

The decision has been welcomed by campaigners from FACT, the Federation Against Copyright Theft, and the BPI, which represents the British music industry.

Kieron Sharp, FACT Director General, said: "FACT has been working with Safer Leeds to find a solution to the problems that have plagued Cross Green Market for years. Over the past year alone we, along with other organisations, have made frequent visits to the market and found a high proportion of stalls selling counterfeit and stolen goods.

"FACT works with a wide range of organisations as part of the 'Real Deal' campaign which seeks to make markets across England and Wales safe for the public to visit by removing those selling counterfeits and getting the market operators and local councils to sign up to a code of conduct.

"It is vital that the trade in counterfeit goods which has blighted so many markets is stamped out and those markets are returned to being safe environments for families to enjoy. It is regrettable that criminal activity in Cross Green Market had reached such levels that the only solution was to shut it down. However, we will continue to work with Leeds City Council to sign up other markets to the Real Deal Charter."