Tensions between local people and Roma migrants could escalate into rioting unless action is taken to improve integration, David Blunkett has warned.
The former home secretary fears a repeat of race riots that hit northern cities in 2001.
His concerns centre on the Page Hall area of Sheffield, where Roma migrants from Slovakia have set up home.
But he also accused the government of "burying their head in the sand" over the scale of Roma settlement in the UK.
In an interview with BBC Radio Sheffield, he said the Roma community had to make more of an effort to fit in with British culture.
"We have got to change the behaviour and the culture of the incoming community, the Roma community, because there's going to be an explosion otherwise. We all know that."
The Sheffield Brightside MP said he feared a repeat of the violence that erupted between Asian and white youths in Bradford and other cities in 2001.
"If everything exploded, if things went really wrong, the community would obviously be devastated. We saw this in Bradford, Burnley and Oldham all those years ago when I first became home secretary. We saw that the community itself were the losers."
He called on the Roma community in Page Hall to change aspects of their "behaviour", such as congregating on the streets on summer evenings and dumping litter, which he said was "aggravating" local people.
"We've got to be tough and robust in saying to people you are not in a downtrodden village or woodland, because many of them don't even live in areas where there are toilets or refuse collection facilities. You are not there any more, you are here - and you've got to adhere to our standards, and to our way of behaving, and if you do then you'll get a welcome and people will support you."
Mr Blunkett said the local population in Page Hall, which he said was made up of people with "Pakistani backgrounds, Somali, the Democratic Republic of Congo, Yemeni and traditional white working class" also had to make an effort to reach out to the Roma community.
"By all means express how you feel but do something with us. Join the people who are doing something about it," he told them.
The MP said "phenomenal" progress was being made by community groups to improve integration in Page Hall but the government's decision to axe Labour's Migration Impact Fund - a £50m pot for councils to ease pressure on housing, schools and hospitals - was hampering these efforts.
"We are not asking for a lot of money. We are just asking for a bit of understanding from government. A bit of interest. The government's just not interested. It's absolutely pivotal to holding this community together."
And he accused the government of "burying their head in the sand" over the size of the Roma community living in the UK, which he said was revealed in a recent study by Salford University.
"They [the government] have been saying there is less than 50,000 Roma in England. The Salford study shows that at a very conservative estimate, there's over 200,000. That they constitute a very large minority, with real problems."
He suggested the government's refusal to officially acknowledge the scale of Roma settlement in the UK was preventing it from accessing EU funds to aid integration - a point echoed by Sylvia Ingmire, chief executive of the Roma Support Group charity.
Ms Ingmire also backed Mr Blunkett's call for the restoration of government funds to boost local services in areas affected by high immigration - but she also stressed the reasons why Roma families chose to settle in the UK.
"With the growth of state harassment and neo-Nazi violence in East/Central Europe, Roma families have settled in the UK, contributing economically and culturally.
"More recent Roma migrants, however, carry the double burden of both a tough, discriminatory environment in countries of origin, and the winds of austerity and hostility in the UK.
"We acknowledge that these pressures are also faced by many longer-established residents.
"Up until 2011, the availability of targeted funds from government helped in both strengthening local services, and making them more responsive to immediate needs of the newly arrived and the longer-term residents."
A government spokesman said the coalition had cut net migration "by a third" and was attempting to "address the 'pull' factors that previously led to unsustainable impacts on this country".
The spokesman added: "Salford University figures should be treated with extreme caution, as they are estimates based on replies from only a third of local authorities and rely on anecdotal information.
"The Migration Impacts Fund was a two-year scheme created by the last administration.
"Coalition ministers did not view the scheme as particularly effective or value for money, especially given the need to tackle the budget deficit inherited by the government."
Mr Blunkett's intervention was praised by UKIP leader Nigel Farage, who campaigns against the ending of some work restrictions for migrants from Romania and Bulgaria, both countries with significant Roma populations.
He said: "Mr Blunkett should be admired for the courage he has shown by speaking so plainly on this issue. Of course, the type of language he has used I would have been utterly condemned for using.
"The fact that he is talking of the significant difficulties with the Roma population already in his constituency should be taken seriously by the likes of Cameron, Clegg and Miliband.
"My question is if they won't listen to the dangers of opening the door to Romania and Bulgaria next year when UKIP speak out on it, will they listen to David Blunkett? I certainly hope so."
Mr Blunkett later issued a statement distancing himself from Mr Farage's endorsement, stressing he had been talking about the need for better integration.