Britain has been given a second and final written warning by Europe to clean up London's air or be taken to the European court of justice and face fines of up to £300m.

The warning, sent today by the Environment commissioner Janez Potočni refers to minute airborne particles known as PM10s which are emitted by traffic and factories and can lead to heart attacks, strokes, asthma and lung diseases. According to the Mayor of London's Air Quality Strategy, particle pollution is responsible for over 4,300 premature deaths a year in London at an annual cost of up to £2bn. (The figure is drawn from a report commissioned by the Mayor of London whose full findings were not published.) London's air pollution levels rank as the worst in the UK and also among the worst in Europe.

The EC move follows the start of legal proceedings against the UK in January 2009 for failing to meet air quality standards that came into effect at the end of 2004. The dying act of the last government, on 3 May, was to reapply for a time extension until 2011 to comply with air quality laws for dangerous airborne particles.

Today's decision leaves the problem in the lap of the new coalition government and Boris Johnson, the mayor of London, who has a statutory duty to produce a strategy for improving London's air quality.

Johnson has been heavily criticised by opposition parties for unravelling environment policies put in place by his predecessor, Ken Livingstone, such as his decision to delay the introduction of phase 3 of the Low Emission Zone (Lez), which fines the most polluting vans, and his plan to abolish the western extension of the congestion charge zone by Christmas.

The Lez is designed to cut harmful emissions by encouraging the replacement of high-polluting vans and lorries with new models that meet the required emissions standards. Transport for London has admitted that scrapping the western extension of the congestion charge will result in increased traffic.

Simon Birkett, spokesman for air quality watchdog group the Campaign for Clean Air in London, said that Johnson's draft proposals to improve air quality were "riddled with wishful thinking".

"He continues deliberately to take backward steps on air quality, particularly in respect of transport. In that respect, for example, the removal of the [Western extension of the congestion charge zone] would be a double whammy because air quality will worsen and Transport for London will lose over £55m income."

Johnson told the London assembly last December that any fines incurred if the UK government is taken to court should "not be borne by this city" because he said it was the government's fault that London was not compliant in the first place.

In a statement, Potočni said: "The UK submitted an exemption request for eight zones including the Greater London urban area. However, the commission did not consider the exemption justified, as seven out of the eight zones already complied with the limit values. For the Greater London urban area, the commission considered that the UK had not shown that compliance with the daily PM10 limit value would be achieved by the time the exemption period expired in 2011. The UK has recently sent a further exemption request for Greater London, which is still under assessment. However, given that zones still exceed the PM10 limit values, the commission is sending the UK a final warning. If the UK fails to take the necessary measures to comply with the legislation, the commission could refer the case to the European court of justice.

"Boris Johnson must introduce tougher measures to ensure that all London meets EU air pollution limits, rather than relying so heavily on the government to act", said Jenny Bates, London Friends of the Earth campaigner. "By making London a safer place to walk and cycle and improving public transport, he could get people out of cars and ensure cleaner air for everyone who lives in, works in or visits the capital."

A spokesman for Johnson said last night: "The government made a submission to the European Commission last year seeking additional time to meet limit values. Since then the mayor has published an air quality strategy and the government has re-submitted additional information to the commission. We are therefore confident that these developments will address the concerns that triggered this legal action."

The letter will also force Britain to clean up air quality in Gibraltar, which also regularly exceeds EC maximum levels and is classed by the EC as a British zone.

• This article was amended on 6 June 2010. The original said that the figure of 4,300 premature deaths per year due to particle pollution in London had come from a House of Commons environmental audit committee report. This has been corrected.