The new round of cuts in local authority budgets will mean that many libraries will stop buying books, some will close and others will reduce opening hours yet again.
Ross Shimmon, chief executive of the association, said: "This is grim news at a time when schoolchildren are using libraries more than ever because of the demands of the national curriculum and the decline of the school library service. It is ironic that (the cuts) coincide with increasing concern over standards of literacy."
The warning comes shortly after the publication of two reports last December which highlighted the serious consequences to the school library service in the wake of local authority delegation of budgets to schools.
More than two-thirds of England's 108 library authorities replied to the association's survey with 73 per cent expecting to make cuts this year.
Thirty-one said they were likely to face cuts in book funds, with Somerset suffering the most. A 37 per cent drop in income means the county will will not be buying any new fiction in 1995-96, while in Lancashire no new books will be bought until April.
Nine authorities predicted closures of, in total, 37 branch libraries and five mobiles. In Cambridgeshire alone 10 libraries are under threat. Opening hours will be affected with Shropshire losing 48 hours a week and the London borough of Lewisham 64.
The association is urging the 24 million library users in England and Wales to fight for the service by lobbying MPs and councillors. "People need to know that it is being very badly damaged. The cumulative effect of cuts is terrible - in the late 1970s there were 116 libraries open for at least 60 hours a week. By 1993 this had dropped to 10."
He warned that Stephen Dorrell, the National Heritage Secretary, could be in breach of his statutory duty "to superintend, and promote the improvement of the public library service provided by local authorities".
The Coopers and Lybrand report for the Department of National Heritage, published in December, said there was no evidence to suggest that a commercial provider would emerge if the school library service declined.
The second report, published by Loughborough University, revealed that spending on books and materials had been cut by almost a fifth and staff numbers had declined by nearly 16 per cent since budgets were delegated.