A million Britons will swap dial-up for broadband in the next year, says the telecoms watchdog Oftel.
Half of the UK are now online at home
More are signing up to broadband, an always-on connection 10 times faster than dial-up, as it gets cheaper.
Oftel's latest figures show half of all households in the UK are online, with 750,000 new web users in the last three months.
Both dial-up and broadband net access is cheaper in the UK than other European countries.
"Growth in internet access, coupled with some of the lowest prices in Europe is excellent news," said David Edmonds, Oftel's Director General of Telecommunications.
"Oftel's policy of creating competitive markets for internet access continues to drive the growth in internet access," he added.
There are now 12.5 million households online in the country.
The push towards broadband, which offers a much faster, permanent connection of 512Kbps, has also proved successful, the research suggests.
The UK Government is aiming to make the UK one of the most competitive broadband markets in Europe, with more people connecting to high-speed net than in Germany and France.
About 80% of the UK is now able to get broadband access through ADSL (Asymmetric Digital Subscriber Line), while about 40% of the country is covered by cable broadband connections.
The figures from the watchdog's quarterly research comparing consumer use of net services with other European countries, also show 90% of households are happy with their net services overall.
"We look forward to these trends continuing," said Mr Edmonds.