Up to 14 unaccompanied child asylum seekers are being placed in hotels in the UK every day.
Figures uncovered by the Local Government Association reveal that 3,256 children were housed in hotels between October 2021 and September 2022.
The LGA is calling on the government to help councils to develop more placements for unaccompanied children so they can be moved directly to long-term homes.
The new figures come as hundreds of migrants were moved out of an immigration centre in Kent after concerns that it had become dangerously overcrowded.
Immigration minister Robert Jenrick said the number of migrants at the Manston migrant processing centre had "fallen substantially" on Tuesday, with more expected to be moved on Wednesday.
The situation was described as a "breach of humane conditions" on Monday, with 4,000 people being held at the site ― more than double the number it was designed for.
Andy Baxter, the assistant general secretary of The Prison Officers' Association, who visited the centre more than a week ago, has warned “unrest is spreading” across the camp.
He told Sky News: “Tensions are rising. The population is getting bigger and bigger. There is nowhere to move these people on to. I think eventually we will see a serious breakdown in public order.
“Our members are facing threats from people constantly saying 'what's happening to me? Where am I going? When will I be getting moved on?'."
The exact number to have been relocated has not been confirmed, but Sir Roger Gale, the Conservative MP for the North Thanet constituency which includes Manston, said several hundred had already been moved.
The UK's asylum system has come under increasing strain because of an increase in people arriving on small boats.
The latest official figures show the number of asylum seekers crossing the Channel to the UK this year so far has reached 38,000.
“The root cause of the problem is the sheer number of people choosing to make that dangerous journey, putting immense pressure on our system," Mr Jenrick said.
"We don’t design the system for 50,000 people-plus to cross the Channel illegally, every year.
“And we as a country are struggling to know how to support them because our asylum system was not designed to receive thousands of people every day.”
UK officials say they are spending about £7 million ($8.12m) a day housing asylum seekers in hotels, with the cost expected to rise.
As of October 19, 222 young people who were being accommodated in hotels were missing.
Councillor Louise Gittins, chairwoman of the LGA’s children and young people board, said the issue is "deeply concerning".
“Councils don’t want to see any child placed in a hotel, by government, which is completely unsuitable for unaccompanied children," she said.
"It is deeply concerning and unacceptable that these hotels, which were introduced as a short-term emergency measure, remain in use, especially as the number of children going missing from them continues to grow.
“Despite best efforts, recent changes to the National Transfer Scheme have failed to address the challenges that are preventing councils from placing every child as soon as they arrive. These include a lack of placements, an underfunded system, significant workforce shortages and challenges with age assessment.
“We urgently need a plan to tackle this crisis and to ensure children can move quickly to their permanent placements. This would mean children get swift access to the care and support they need after arriving in the UK following an extremely traumatic journey.
“The forthcoming autumn statement is the ideal opportunity for the Home Office to demonstrate commitment to making the scheme work and ending the use of hotels by fully funding councils to support unaccompanied children, including when they become care leavers.”
The LGA has set out a four-point plan to tackle the issue, including creating a dedicated foster care system for unaccompanied minors, using the Homes for Ukraine scheme to provide supported lodgings for older children.
The government has come under mounting pressure to address the crisis in the asylum system after the scale of overcrowding was revealed at a processing centre in Kent.
Overcrowding there worsened after a petrol bomb attack on a British immigration border force facility in Dover at the weekend.
Mr Jenrick said new hotels were being procured “very rapidly” to address the problem.
But, he said, “more radical measures” may need to be taken.
“I am afraid we now have to look at some more radical options to ensure our laws are appropriate, so that economic migrants are returned swiftly and that we deter people from coming to the UK,” Mr Jenrick told BBC Radio 4 on Tuesday.
“The United Kingdom cannot continue to be a magnet for economic migrants. We simply do not have the infrastructure in this country to manage that."
Home Secretary Suella Braverman caused controversy on Monday when she told MPs that Britain was facing an invasion, language reminiscent of that used by the far right.