Almost a quarter of adults in Northern Ireland and the Republic have problems with "even the simplest literacy task", according to the cross-Border study.
It found that while the education systems North and South differed, levels of illiteracy were similar and compared unfavourably internationally.
Television is cited as a significant negative factor. The study shows that in the North 46 per cent of those who watch five hours or more of television daily have poor literacy skills and only five per cent of the study reached the top literacy measurement.
About 24 per cent of the adult populations North and South cannot read simple English, for example the instructions on a medicine bottle. This compares with six per cent in Sweden.
This rate is classified as level 1 in the international adult literacy survey, regarded by most educationalists as the most authoritative guide.
Using this yardstick the Republic's illiteracy levels are lower among its younger people. For example 21 per cent of those between 16 and 25 in Northern Ireland are level 1, compared to 15.9 per cent in the Republic. However the Republic's levels increase in older age groups.
Differences among the communities in Northern Ireland are also highlighted. For example, young Protestant males have an education the "equivalent to almost two years of schooling" more than their Catholic counterparts.
The report includes several recommendations on how to improve literacy. It says family based literacy programmes are "one of the best approaches" and urges the creation of a North-South resource centre to study this area.