One in five has a Facebook page, even though rules say they must be 13, according to EUKidsOnline.
The report's authors suggest that removing such requirements would make it easier to monitor online behaviour.
However, children's charity Kidscape criticised the idea and warned it would lead to more cyber bullying.
The research, carried out by the London School of Economics for the European Commission, was based on a survey of 25,000 young people - aged between nine and 16 - from across Europe.
It asked if they maintained a social networking profile.
In the UK, 43% of 9 to 12-year-olds answered yes, along with 88% of 13 to 16-year-olds.
The Netherlands had the highest percentage of children on social networks at 70% - however many of these were users of Hyves, a site that does not have a minimum age.
Across Europe the average figure for 9 to 12-year-olds was 38%.
Report author Elisabeth Staksrud, from the University of Oslo, told BBC News that it was inevitable children would be drawn to sites such as Facebook: "If you're twelve you want to be where your peers are".