Library use in Brighton and Hove is falling due to poor service and because there aren't enough books on the shelves.
Inspectors visiting the city's libraries found them underfunded, understocked, and open for too few hours.
They also said library buildings needed improving to allow access for the disabled.
The findings have been released a report by the Audit Commission.
Jane Wreford, the commission's regional director, said: "Brighton and Hove's lifelong learning service is well co-ordinated and provides a broad range of learning opportunities.
"The library service employs high quality enthusiastic staff who are providing a mix of traditional and new computer based facilities across the city.
"There is, however, current low public satisfaction, poor opening hours and declining library use."
The report said the library service in the city only met or exceeded 11 of the 19 public library standards.
Ms Wreford added: "The plans for the new Brighton Central Library are innovative and will deliver considerable improvement.
"In addition, councillors show strong ownership and commitment to improving these services."
The inspection was part of the Government's Best Value programme, which places a duty on councils aimed at improving local services.
A spokeswoman for Brighton and Hove City Council said: "The Audit Commission praised our staff, learning opportunities and computer facilities.
"Visitor numbers here are on a par with other areas of a similar size.
"Our book stock is in fact larger than many other local authorities because we have particularly fine historic and rare books collections.
"We are also investing for the future. Work has started on a new library for Patcham, due to open next May, and work will begin soon on the new Jubilee Library which will open with a completely new stock of books."
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