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The UK is running the risk of turning into "Tescoland", according to a leading thinktank.

With more than 2,000 stores nationwide and plans for further expansion, Andrew Simms, director of the New Economics Foundation (NEF), warned that Tesco's dominance would damage competition.

Speaking to Channel 4's Dispatches programme, Mr Simms was heavily critical of the tactics the company has used to increase its market share.

"They come at it from every angle. They target the councillors, they will target the local community," he said. "They are fighting these campaigns all the time, day in, day out."

Mr Simms added: "We are going to wake up - in the not too distant future - and we will be living in 'Tescoland'."

MP Keith Vaz told the programme that Tesco had "eaten up all the minnows" and become a "huge shark", criticising the regulator for failing to halt the company's remarkable growth.

"They should not have allowed Tesco to get so big," he said.

But retail analyst Richard Hyman defended the company, which now accounts for around one pound in every three spent in British supermarkets.

He argued that any attempt by the Competition Commission to rein in its growth would be seen as punishing success.

"I would be flabbergasted if the Competition Commission decided that Tesco couldn't or shouldn't grow any bigger," he said. "I think that would be a disaster for the UK economy, it would be a disaster for the whole idea of risk taking and the reward you get for hard work and for getting it right."

Tesco maintains that the supermarket sector is highly competitive and that consumers are benefiting as a result.

Chief executive Sir Terry Leahy said recently: "I believe passionately that consumers have benefited in so many ways from the intense competitive rivalry in this industry.

"All of the evidence suggests that customers are very satisfied with the choice available to them and new stores continue to open all the time."

Research by analysts at CACI revealed last year that Tesco was the number one supermarket in 68 per cent of UK postcodes.

The firm recently unveiled plans to enter the US and Chinese markets.