Brits could be banned from all-inclusive holidays - unless they stop making fake '˜food-poisoning' claims
Travel bosses have been left "embarrassed" by the huge spike in reports of holiday sickness, which they describe as "a British problem".
Most cases involve all-inclusive resorts as claimants say they only ate at their hotel in a bid to identify it as the cause of their supposed food poisoning.
Travel trade organisation Abta has launched a campaign urging the Government to close a "legal loophole" which it says is encouraging lawyers to sign up people to insist they were ill even if they were not.
Tens of thousands of UK holidaymakers have made claims in the past year despite reported sickness levels in resorts remaining stable.
Since spring 2016 travel firm Tui has recorded around 15 times more illness claims than in previous years.
They are typically worth around £3,000 to £5,000 - which is more than the cost of many of the holidays involved.
In cases where tour operators make a payout, they can attempt to claw the money back from the hotels themselves.
But Tui's UK managing director, Nick Longman, said there has been "friction" between the two sides, with hoteliers initially believing "we weren't doing enough" to stop the scam.
He told the Press Association that the bogus claims could lead to the end of all-inclusive holidays for UK customers.
"There's a distinct risk that if this carries on as it is unabated, the hoteliers will say to us either 'We don't want to work with the British market at all' or 'We're not going to offer you all-inclusive'.
"I think that would be a terrible thing for the British customer. It's just going to reduce the choice in terms of destinations and the type of holiday," he said.
Thomas Cook's UK managing director, Chris Mottershead, also warned that the scam could lead to the end of such holidays.
"It's a very serious situation because it has the effect of stopping all-inclusive holidays for the UK market," he said.
"It has the potential of putting hoteliers out of business. They will stop British customers coming into their hotels."
All-inclusive breaks have grown in popularity in recent years as consumers seek greater certainty over how much their trip will cost.
Tour operators say the sickness issue is ruining the reputation of UK tourists abroad.
Mr Longman described the situation as "totally embarrassing", adding: "A hotel will have customers from four or five markets of Tui and it will only be the British Tui customers who are complaining.
"All you can do is apologise and say 'We're sorry'.
Abta chief executive Mark Tanzer said the fraud is "one of the biggest issues that has hit the travel industry for many years".
The organisation's Stop Sickness Scams campaign claims legislation designed to halt the surge in fraudulent whiplash claims - a cap on the legal fees that can be charged by law firms pursuing personal injury cases - has fuelled the rise in travel sickness reports as it does not apply to incidents overseas.
"The Government must urgently address this issue," Mr Tanzer said. "The legal loophole that is allowing firms to unduly profit from these claims must be closed.
"This would allow people with genuine claims access to justice but make this area less attractive to claims firms."
He also warned that holidaymakers pursuing fake or exaggerated claims "risk ending up in jail either in the UK or abroad".
Professor Jaime Campaner Munoz, a solicitor acting on behalf of Spain's Federation of Majorcan Hotels, said: "We will be seeking convictions against anyone who is involved in these fraudulent claims."