The mayor of New York has bolstered a global crusade against tobacco with a donation of a quarter of a billion dollars to curb the growth of the industry in low- and middle-income countries.

Michael Bloomberg, who introduced a ban on smoking in public places in New York despite warnings that it would destroy tourism and alienate voters, is putting unprecedented sums of money into anti-smoking efforts in poorer parts of the world where the industry is increasingly looking for expansion.

About 80% of deaths from smoking-related diseases last year were in low- and middle-income countries, according to the World Lung Foundation's Tobacco Atlas published on Wednesday.

Smoking is the biggest killer in China, causing 1.2 million deaths a year and is the leading cause of male deaths in Turkey (38%) and Kazakhstan (35%). It is the biggest killer of women in the Maldives (25%) and the US (23%).

"There is nothing that any of us here will do that will save as many lives as stopping people smoking," said Bloomberg in New York, before he left for this week's world conference on tobacco and health in Singapore to make his announcement. "It is a scourge all over the world – more so in the places where education isn't up to the standards that it is in the developed world, and the tobacco companies certainly try to target people who are poor and uneducated in their advertisements. I don't think there is any question about that."

Bloomberg is the 12th wealthiest person in the US with a net worth of $19.5bn (£12.3bn), according to the Forbes rich list last September. The $220m grant from Bloomberg Philanthropies will refill its fighting fund – $375m has been spent over the past six years. In 2008, the Bill and Melinda Gates Foundation joined in, announcing an additional $125m over five years.

Bloomberg's money is targeted primarily at five populous countries where smoking is a big and growing problem – Bangladesh, China, India, Indonesia and Russia – and 15 others, which, in total, are home to two-thirds of the world's smokers.

Grants will go to organisations that can support and encourage governments to pass anti-tobacco laws, such as smoking bans in public places, advertising restrictions and increases in the price of cigarettes, in line with the World Health Organisation's Global Framework Convention on Tobacco Control.

"We want to get governments to raise taxes," said Bloomberg, remembering the days when children could get a pack of cigarettes from a slot machine in New York for 25¢; now they cost $11. "It is a real disincentive for kids – they don't have the disposable income." And he wants to de-glamorise smoking by persuading TV and film companies not to feature stars with cigarettes in their hands.

But governments in low- and middle-income countries which try to use the law to curb smoking are increasingly being challenged by major tobacco companies. Bloomberg's money will help the likes of Uruguay fight a legal action brought by Philip Morris International.

Using a Geneva-based holding company as the complainant, Philip Morris is alleging that large and graphic health warnings imposed by the Uruguayan government on cigarette packets violate a trade agreement between the South American country and Switzerland. The case is being heard at the International Centre for Settlement of Investment Disputes of the World Bank.

It is important, say campaigners, because if Philip Morris wins, other small countries will be intimidated and less likely to face up to large tobacco firms.

"If PMI is allowed to compromise Uruguay's ability to protect its citizens, this will serve as a go-ahead to tobacco companies to challenge other nations' tobacco control laws," warns Bloomberg Philanthropies.

British American Tobacco has also threatened trade action against Namibia over the size of health warnings on packs.

Dr Judith Mackay, one of the authors of the World Lung Foundation Tobacco Atlas and a well-known anti-tobacco campaigner, said it showed "the whole drive from the high income to the low-income countries", adding that the tobacco companies "are now challenging legislation from Scotland to Australia to Iran to Latin America. This is one of the biggest developments we have seen and one of the most sinister. The WHO has said it has got lawyers and will help. This is a form of harassment and intimidation of other countries that might face challenges."

In some countries, there is no ban on tobacco companies giving free gifts and sponsoring sports events and the arts, she said, and a lack of transparency meant only in a few countries would politicians have to declare who funded their election campaigns. "There may be vast undersea funding about which we know nothing," Mackay said.

There are success stories. Even though China's enormous and profitable tobacco company is a state-controlled monopoly industry, the government has ratified the tobacco control framework convention and Harbin, a city in northern China, has brought in a smoking ban in public places. Turkey backed a nationwide ban in 2008, while Bloomberg-funded organisations rallied public support. Singapore was the first country in the world to ban tobacco advertising, in 1970.

Mackay said: "The message from Asia, which is where the transnational companies have said their future lies, is that although it is the principle target, it is willing and able to put tobacco control measures in place. The battle lines are drawn."