An annual report on drug use says around 4.5 million Europeans are likely to have used cocaine in the past year - a million more than in 2006.
The EU drugs agency (EMCDDA) says the increase in cocaine seizures and quantities also confirms its status as " Europe's stimulant drug of choice".
Prevalence of the drug is highest in Spain and the UK but the biggest increases are in Denmark and Italy.
About two million Europeans are said to have used cocaine in the past month.
The drugs agency bases its figures on information covering 2005. In that year, it says that seizures of cocaine reached record levels. A total of 107 tons of the drug was recovered - up more than 45% on the previous year.
Spain and Portugal are the main points of entry into Europe.
The EU drugs agency says the rise in demand for treatment is an indication of how cocaine use is affecting public health.
It says that in 2005, 22% of all new requests for help were cocaine-related, almost three times the figure for 1999.
Spain and the Netherlands had the majority of reports of treatment. About 400 deaths relating to cocaine were reported in 2005.
The agency says current systems make it difficult to detect the health consequences.
There has also been a steep rise in the offences linked to cocaine. Across the EU, the agency reports an average 62% increase with Germany the only exception.
The majority of crime is concerned with drug use or possession.
Cannabis is still the most commonly used illicit drug in Europe, but the agency says there are signs of its popularity waning among the young.
In Spain, 20% of 15-34 year-olds are estimated to have used the drug in the past year, with similarly high rates in the Czech Republic (19.3%), France (16.7%), Italy (16.5%) and the UK (16.3%).
In the UK, France and the Czech Republic, that represents a fall of three to four percentage points.
The UK Home Office Minister, Vernon Coaker, welcomed the report.
He said that drug use as a whole was "at its lowest level in 11 years" and that drug-related crime had "fallen by a fifth since 2003, reducing harm to communities".
Nevertheless, the agency warns that some 7% (23 million) Europeans have taken cannabis in the past year and about three million people may be using it on a daily, or almost-daily, basis. ( BBC )