The number of Romanian nationals living in the UK in 2017 was estimated to be 411,000 - a jump of 25% on the previous year, and the largest increase for any country.
Polish remains the most common non-British nationality, with an estimated one million in the UK.
Romania has overtaken the Republic of Ireland and India to move from fourth to second place in the list.
Some 350,000 Irish nationals lived in the UK in 2017, while there were 346,000 Indians.
The figures, from the Office for National Statistics (ONS), show the total number of non-British nationals living in the UK in 2017 was 6.2 million, up 4% on 2016’s total of six million.
This is a smaller rise than that recorded between 2015 and 2016, when the number rose by 8%.
Nicola White of the ONS migration statistics division said: “Non-UK born and non-British populations continued to increase in 2017, as more people continued to come to the UK to live than move to live abroad for a year or more.
“Poland-born residents and Polish nationals were the most common populations from outside the UK. However, the largest increases in population were seen from those born in Romania and those with Romanian nationality.”
The figures show that 3.8 million (61%) of the 6.2 million non-British nationals living in the UK in 2017 held EU nationality.
This is roughly the same proportion as 2016 (60%).
London had the largest proportion of non-British nationals in 2017, with the highest numbers in the local authorities of Newham (38%), Westminster (36%) and Brent (34%).
The ONS data is based on a survey of households and does not cover most people living in communal establishments, some NHS accommodation, or students living in halls of residence who have non-UK resident parents.
Separate figures show the number of people living in the UK who were not born in this country - which is different to non-British nationals - increased from 9.2 million in 2016 to 9.4 million in 2017, up 3%.