Music site RnBXclusive.com has been shut down by the UK's Serious Organised Crime Agency (Soca).
A takedown notice warned visitors who have used the site to download music they could face up to 10 years imprisonment and an unlimited fine.
Soca said music posted on the site was "stolen from the artists" and may have "damaged careers".
A man has been arrested for fraud and bailed pending further enquiries, police told the BBC.
"Soca targets organised criminal enterprises profiting from the exploitation of the UK public and legitimate businesses," the agency said in a statement.
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Members of the public can become facilitators of organised crime by obtaining property or services from its perpetrators”
Soca statement
"Much of the music offered for download by the RnBXclusive.com website was illegally obtained from artists, leading the industry to attribute losses of approximately £15m per year to the site's activity."
Soca added that the action was part of a wider operation combating illegal uploading of copyrighted material online, with several sites being targeted using "varied techniques".
Some industry observers believe the action is a fresh sign that British authorities are stepping up efforts to stamp out online piracy.
However, Loz Kaye, leader of the Pirate Party UK, said he disagreed with the nature of the closure.
"The explicit threat to visitors of the site and take down notice is alarming.
"The claim that the information gathered can be used to identify visitors and their location, followed by a statement that Soca has the capability to monitor, investigate and inform visitors internet service providers of apparent 'infringements', making visitors liable for prosecution seems extreme and unduly threatening."
RnBXclusive.com also ran Twitter and Facebook accounts which remain accessible - although links posted on both services are now inactive as a result of the main site's takedown.
'Monitor and investigate'
On Facebook, fans of the website reacted angrily to the closure.
"Screw Soca!" one user wrote. Another added: "Am I the only one scared of this 10 year jail and fine?"
Police told the BBC they would not comment on whether any of the site's users were currently being pursued.
The website, which is registered to an address in Leicester, was unreachable on Wednesday.
The Soca message, which is now displayed to all visitors of RnBXclusive, displays the user's internet protocol (IP) address, which can be used to identify people online.
The notice warns that Soca has "the capability to monitor and investigate you".
"Members of the public can become facilitators of organised crime by obtaining property or services from its perpetrators," a Soca spokesman said.
"Soca is committed to raising awareness of this threat, its potential consequences, and the steps people can take to avoid involvement."
Last month, officials shut down MegaUpload - one of the world's biggest file-sharing sites. Its owner, Kim Dotcom is being held in New Zealand having been denied bail.
