SEX parlours are opening throughout Melbourne in huge numbers - more than 2500 are now registered to operate freely across suburban locations.

Figures obtained from the Victorian Government show 2530 people were registered to offer owner-operated sex services, often doing business out of private homes and small shops.

Industry insiders fear they are dodging licensing requirements by registering as sole traders rather than full-scale brothels, which are monitored more closely.

At least 214 people applied to operate small sex businesses last year.

There are also an estimated 400 illegal brothels currently in Melbourne.

The combination has raised fears the sex industry is not being properly policed.