Rooms which were being offered for an average £210 have now been cut in price to £160, according to one survey.
Tourism chiefs confirmed the fall, which comes after Locog, the games' organisers, released thousands of unwanted hotel rooms in the capital and hoteliers began to abandon minimum stay rules, allowing tourists to book one or two night stays.
The average rate for rooms in London during the main Olympic period of July 27 to August 12 has fallen from £213 to £160 - a drop of 24 per cent - the new figures will reveal next week.
However, that is still a 75 per cent increase in prices on last year's rates. Hoteliers had raised prices in anticipation of increased visitor numbers to the UK for the London 2012 Olympics.
The price cuts mean a double room at the four-star Britannia International, at Canary Wharf, will cost £259, compared to previous rates of £395, while a double room at the three-star London Ealing Hotel, on Ealing Common, will cost £121, down from around £150.
Last month the four-star Radisson New Providence Wharf Hotel, three miles from the Olympic Park, was showing the cheapest rate of £594, for a double or twin room, for the Games period.
But similar rooms are now available during the Olympics for between £210 and £306.
Industry experts hope say the price cuts will attract an increased number of visitors.