Twenty-six Romanians – including a toddler – have been found packed into a three-bedroom home.
The discovery near the Olympic Stadium was made during a raid by council staff.
Criticising the ‘Dickensian’ conditions, Newham Council leader Sir Robin Wales said it was ‘unacceptable’ that people were still living in such a desperate state.
He added: ‘Many criminal landlords have no qualms about packing five people to a room.
'Even though we played host to the Olympics in 2012, we still find our residents living in sheds in 2015.’
Council enforcement officers visited the East London property on Friday following complaints from neighbours about loud music, pests and rubbish in the garden.
Officers found that 26 Romanians were living there, including four families and a young child.
Seven people were sleeping in a windowless basement which had air vents blocked up. The others slept in three ‘very overcrowded’ bedrooms.
The people in the basement were paying just £20 a month, while families in the bedrooms were being charged around £180 a month.
The landlord was thought to be collecting at least £2,340 a month in rent.
He had first been reprimanded in 2012 for breaching the property’s multiple occupancy rules, which said he could only house a single family of up to seven people, and could now face prosecution. Newham Council, one of Britain’s poorest areas, has handed out dozens of enforcement notices to slum property owners in the last five years.
Yesterday Sir Robin vowed to tackle the problem by prosecuting any ‘unscrupulous’ landlords.