TRI Hospitality Consulting's latest statistics show that the occupancy of London hotel rooms fell from 85.2% in April 2009 to 78.1% this April.
The 7.1% decline can be attributed to the ash cloud from Eyjafjallajoekull, said TRI Hospitality Consulting deputy managing director David Bailey.
The situation was compounded by political uncertainty in April, he added.
"While the disruption caused by the volcanic ash cloud initially led to an increase in room occupancy as people were stranded, London hoteliers were hit hard by cancellations as the disruption continued," said Bailey. "However, hoteliers were successful in driving up the average room rate, which increased by 6.7%."
London was hit harder by the volcanic ash than many European destinations, and TRI attributes this to the UK's reliance on air transport.
Paris hotel room occupancy dropped 0.8% and Amsterdam hotel room occupancy dropped 0.2% in April.