The market saw a 10% increase in single sales throughout 2011, with 177.9 songs sold by the year's end. Approximately 99.3% were sold as digital tracks and EP bundles.
Only 1.1 million physical singles were sold throughout 2011, making up 0.6% of the total sales tally, reports Music Week.
Over 1 million albums and 5.7 million singles were sold digitally over the last week of December, making it the biggest week ever for digital sales of both formats.
However, the overall sales of albums fell by 5.6% in 2011 to just 113.2m units sold throughout the year, compared to 119.9m in 2010.
Speaking about the declining sales of albums, BPI chief executive Geoff Taylor explained: "British artists continue to produce incredible music that resonates at home and around the world.
"But while other countries take positive steps to protect their creative sector, our government is taking too long to act on piracy, while weakening copyright to the benefit of US tech giants."
He added: "The UK has already fallen behind Germany as a music market. Unless decisive action is taken in 2012, investment in music could fall again – a creative crunch that will destroy jobs and mean the next Adele may not get her chance to shine on the world stage."
Meanwhile, vinyl LPs saw a sales increase of 43.7% having shifted 337,000 units in 2011, with Adele and Radiohead among the highest sellers.
Adele recently became the first artist to sell 1 million copies of a single album on the European iTunes store with her second LP 21.