Household rubbish put out for recycling is dumped in landfill sites or sent to incinerators by three out of four councils, it has been reported.
Councils admitted destroying more than 100,000 tons of recyclable waste, according to The Daily Telegraph.
Medway, Peterborough and Reading councils had the worst figures, with each failing to recycle more than 10% of what was collected.
Pembrokeshire Council revealed that 19% of kerbside recycling ends up in landfill, while Derbyshire County Council said 30% of recyclable cans would not be reprocessed.
The councils who responded to the investigation said 100,503 tons of recyclable waste was dumped in landfill or sent to incinerators in the last financial year.
If the figure is taken as representative of all the councils in England and Wales then the actual total could be nearly 200,000 tons, the newspaper found.
This leaves councils with a large landfill tax bill, with the current £32 per tonne rate rising to £40 per tonne in the next financial year. The cost of throwing away goods put out for recycling was therefore estimated at £6.4 million, and could increase to £8 million.
A spokesman for the Department for Environment, Farming and Rural Affairs denied that the investigation demonstrated a problem with recycling.
He said: "Figures published in November show that 90% of local authorities are meeting or exceeding their recycling targets. England alone recycled 9.7 million tons of municipal waste in 2007/8.
"It's vital that we all continue to recycle what we can as the last thing we want is for recyclable materials to end up in landfill."
