UK Border Agency staff search lorries. Photo: Gareth Fuller/PA
It says there are indications that increasing numbers of people are being brought into the UK for the purposes of sexual exploitation and forced labour.
The council raises particular concerns over a lack of secure and suitable accommodation for trafficked children who end up in local authority care.
It calls for better trained supervisors or foster carers for them.
The Council of Europe's Greta (Group of Experts on Action Against Trafficking in Human Beings) says reports suggest a "significant" number of trafficked children in local authority care go missing and some end up rejoining those who exploited them in the first place.
Its report says hundreds of people have been identified as victims of trafficking in the UK but only 56 people were convicted of human trafficking in 2009 and 29 the following year.
The common countries of origin were China, Vietnam, Romania, the Czech Republic, Slovakia, Albania, Nigeria, Uganda and India, the report says.
Children tended to be brought in for the purposes of sexual exploitation, domestic servitude, benefit fraud, cannabis farming and forced begging and stealing.
Greta acknowledges good work is going on around the UK but it found inconsistent approaches in different areas.
Greta also highlights what it describes as a significant intelligence gap on trafficking, saying the levels of trust and co-operation between victim support services and law enforcement agencies need to be improved.
The Council of Europe says on its website that it aims to "develop throughout Europe common and democratic principles based on the European Convention on Human Rights and other reference texts on the protection of individuals".
This is its first assessment of human trafficking in the UK since the anti-trafficking convention came into force in the UK in April 2009.
As well as improvements regarding care of trafficked children, Greta recommends a number of actions: