Thousands of New Yorkers who unlawfully rent out their homes using Airbnb could soon face legal action, after the travel site agreed to hand over some of their personal information with the state's top prosecutor.

Airbnb's agreement with Eric Schneiderman, the New York state attorney-general, ends a legal battle that began last October when the San Francisco-based company was hit by a subpoena demanding the names, addresses and other personal details about some 15,000 "hosts" in the city.

The case has been seen as a key test for the “sharing economy” pioneer, which was recently valued at $10 billion. While authorities in some cities including Hamburg, Amsterdam and Seoul have passed rules allowing short-term holiday rental services in private residences, Airbnb’s business model has faced legal challenges in areas such as Berlin and New York, which are among its largest markets. The firm has its European headquarters in Dublin.

Mr Schneiderman has claimed that almost two-thirds of Airbnb’s hosts were breaching a New York law prohibiting them from subletting their entire homes for less than 30 days.

At the time of the subpoena, Airbnb said it shared the attorney-general’s goal of “fighting illegal hotel operators and slumlords” but condemned the information request as an “unreasonably broad...government-sponsored fishing expedition” that infringed on its users’ privacy. Since then, Airbnb has ejected more than 2,000 “bad actors” from its site.

Last week, the New York state supreme court said it agreed with Airbnb that the subpoena was overly broad, while voicing concern that a “substantial” number of its hosts were breaking the law. Mr Schneiderman responded with a narrowed subpoena which led to today’s accord.

“Airbnb and the office of the attorney-general have worked tirelessly over the past six months to come to an agreement that appropriately balances attorney-general Schneiderman’s commitment to protecting New York’s residents and tourists from illegal hotels with Airbnb’s concerns about the privacy of thousands of other hosts,” the two organisations said in a joint statement.

“The arrangement we have reached today for compliance with the OAG subpoena strikes this balance,” they added.

Under the deal, Airbnb will hand over details about all of its hosts in New York, including building addresses but redacting names, contact details, unit or apartment numbers and other personal information.

Over the next 12 months, the prosecutor’s office will comb this anonymised information to find people who are “the subjects of an investigation or potential enforcement action”. Under the terms of the agreement, Airbnb will hand over full information about those individuals and must also issue a warning to all its New York hosts, making them aware of the relevant regulations and tax obligations.

In an opinion piece for the New York Times last month, Mr Schneiderman said companies such as Airbnb and Uber, the car-hailing service, were “cybercowboys” who were making the online world “one of the primary crime scenes of the 21st century”.

“Just because a company has an app instead of a storefront doesn’t mean consumer protection laws don’t apply,” he wrote.

Airbnb said today that it would continue to fight regulations that threatened its community and business model.