The government claims its illicit tobacco crackdown has reversed years of black market growth.
It comes as authorities seize more illegal tobacco than ever, including 730 tonnes between July and September.
The government continues to ramp up efforts, aggressively targeting borders as well as illicit tobacco stores.
The government says its crackdown on organised crime and at the borders has seen Australia's illicit tobacco market shrink for the first time in years.
New figures from the Illicit Tobacco and E-cigarette Commissioner (ITAC) show that after five years of rapid growth, an average 22.6 per cent increase each year, there's been a fall from last year's peak of 5,972 tonnes.
ITAC estimates the total volume of black market tobacco has dropped to 5,893 tonnes and could be as low as 4,453 tonnes.
An exact figure is hard to determine given the market's illicit nature but ITAC argues the inclusion of several datasets this year, including the Australian Health Insitute of Welfare data released every two years, has lead to a narrower and more accurate range.
The government attributes the shrinkage to stronger enforcement, larger seizures and better coordination between federal, state and territory agencies.
Assistant Minister for Customs Julian Hill has argued that the crackdown, as well as public health measures to curb demand, was "reversing years of growth".
