Taking place in Preston and Chorley, this operation saw the dogs work with Lancashire County Council and police officers to search out 65 packs of suspected illegal tobacco and £1,780 in proceeds of crime.
The haul included possible counterfeit and non-duty-paid tobacco products, which are incorrectly labelled and cannot be legally sold in the UK.
Sniffer dogs are highly trained and helped to find tobacco concealed in unusual places such as hidden compartments and seemingly empty product boxes.
In the last six months, Lancashire County Council's trading standards team has prosecuted 11 cases involving the sale of illicit tobacco and issued three written warnings relating to counterfeit tobacco.
County Councillor Peter Buckley, cabinet member for community and cultural services, said: "These fraudsters use every trick in the book to conceal illicit tobacco.
"It's often very tricky to find and usually hidden in secret compartments or stashed away in a corner or somewhere where it's difficult to get at.
"It's a much easier job for the sniffer dogs to find it. They pick up the scent and can root it out in minutes, making the job a lot easier for our trading standards officers and the police.
"The sale and manufacture of illegal tobacco has a negative impact on legitimate local businesses and the proceeds of this crime can be used to fund other illegal activities. It also has health implications for our communities and young people.
"We need to tackle this problem and regularly act on intelligence received from the public. Even the smallest piece of intelligence can make all the difference."
County Councillor Sue Whittam, lead member for health, said: "Illicit tobacco is a health concern and it's important we do all we can to stop its sale.
"The low price and easy availability of these illegal products encourages people to keep smoking, and children and young people are often targeted by unscrupulous traders.
"These trading standards crackdowns are crucial and send out the clear message that we won't tolerate illegal tobacco sales in Lancashire."
PC Lena Garnham, of the Chorley Neighbourhood Policing Team, added: "This operation has been about targeting specific shops believed to be linked to the sale of illicit tobacco in Preston and Chorley.
“Illicit products such as these carry the potential to damage public health as the chemicals added to these products aren’t monitored or licensed in any way.
“The people making money out of this do not care who they sell to. Children and young smokers are often targeted by people who sell illegal cigarettes, making it easier for them to get hooked on smoking. The availability of illegal cigarettes makes it harder for people to quit and remain smoke free.
“We would urge anyone that knows someone involved in selling illicit tobacco or counterfeit goods to get in touch so we can safely remove these products off the streets.”
Anyone with information about the sale of illegal tobacco should call the confidential Crimestoppers hotline on 0800 555 111, or report it to Trading Standards via the Citizens Advice Consumer helpline on 0808 232 1133.
They can also report it via the Trading Standards Scambuster Stan Facebook page.