North East Lincolnshire has been rated as the worst council in the country, the only authority to be awarded no stars in a national survey.
The annual Audit Commission review can give up to four stars. It gave the council none, saying it was performing "well below minimum requirements".
East Riding, Lincolnshire and North Lincs councils were awarded two stars and "improving" Hull gained one star.
North East Lincs council said the position was now starting to improve.
The authority said the announcement by the Audit Commission reflected how the authority was performing more than a year ago, and had failed to take into account major improvements since then.
Out of England's biggest 150 councils only eight have been rated as "improving strongly" and these include two in the region - Rotherham Council and East Riding of Yorkshire Council.
East Riding saw its star rating improve from two to three.
Elsewhere in the Yorkshire and Humber region six councils have been judged to be "improving well" and a further five as "improving adequately".
Leeds and Sheffield achieved the top overall performance rating of four stars, with 10 other councils receiving either a three or two-star rating.
This year the Audit Commission has changed the way it assesses the capabilities of local councils by bringing in what it calls The Harder Test Framework.
This puts a duty on councils to improve year-on-year while also meeting the public's expectations.