Anyone caught operating in an unregistered premises can face a $5000 fine and a $50-a-day penalty for every day they continue to operate without being registered.
In this case, both Dunedin operations were given a warning and ceased operating immediately, Ms MacGill said.
The council had previously come across underground tattooists in Dunedin, but it was not a regular occurrence.
Tattooists were required to be registered under the council's beauticians, tattooists and skin piercers bylaw, which requires premises to be inspected annually and provides operational guidelines.
The bylaw aimed to prevent the transfer of communicable diseases such as hepatitis B and C, HIV/AIDS and bacterial skin infections, she said.
"Our concern is that contamination of equipment such as needles, lack of general hygiene in the premises and poor individual hygiene practices on the part of the operator, all have the potential to transfer disease and infection."
The council's registration system operated in a similar fashion to that used for food premises, and premises that met requirements were issued with a certificate they were required to display where clients could see it.
Seven registered tattooists were operating in the city, she said.
Dunedin tattooists yesterday said the underground tattoo scene in the city was growing. Some believed there could be as many as 30 people operating out of n Dunedin homes.
They said the increase was largely due to the ability to buy cheap equipment online, and the popularity of television shows on tattooing.
"People think they can watch a few shows and be a tattooist. They think it's a rock star lifestyle," one said.
