One shopkeeper was fined £16,000 after Surrey County Council seized bottles of fake Glen's Vodka which was found to contain 235 times more methanol than the legal limit allowed.
Methanol is also used to make anti-freeze and can lead to blindness.
Council trading standards teams have also found industrial solvents in bottles.
Councillor Paul Bettison, the Local Government Association's regulation spokesman, said: "Everyone wants a bargain, especially at this time of year, but surely the potential health risks far outweigh any financial savings.
"Frankly, if the offer seems too good to be true, then it probably is.
If anyone is suspicious about a supplier or feels that they may have bought a bottle of counterfeit alcohol, please do not drink it. Instead, contact your local council or Consumer Direct for advice as a matter of urgency."
Signs that a bottle of vodka may be counterfeit include:
:: The liquid inside smelling of nail varnish;
:: Wonky labels with poor quality print and spelling mistakes;
:: Bottles on the shelf not being filled to the same level.
Fake vodka seized by West Berkshire and Wokingham Trading Standards was found to contain chloroform.
Horsham District Council also issued a warning after finding fake vodka marketed as Drop Vodka, Red Admiral, Arctic Ice and Spar Imperial that contained industrial solvent Propan-2-ol.
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