The revolver that killed Dre had the words “Made in Russia” imprinted close to the muzzle, and was fitted with a silencer to muffle the shots. But nothing could mask the tang of cordite in the air or silence the screams of Dre's girlfriend Lauren.

The 350-strong crowd at the Saturday night skaters' disco panicked. There was a stampede for the exits - which was joined by the killer and his accomplices: the one who spotted Dre and made the call; the one who opened the fire door to let in the gunman; the one who would spirit away the gun.

No one has been charged with the murder of the 17-year-old in February 2007. Few witnesses have come forward with information, and the gun that killed the trainee electrician has not been found.

That gun, The Times has discovered, was a Baikal IZH-79 - manufactured in the Russian city of Izhevsk to fire teargas pellets, converted in a Lithuanian workshop to shoot live bullets, smuggled into Britain and sold to the armourer of a South London gang.

Three years ago no one had heard of the Baikal. Today it is the gun of choice in gangland Britain.

The gangs have not chosen it because of any bling or fear factor. The Baikal is a small, snub, black handgun that looks almost like a toy - the sort of cap-gun with which boys played cops and robbers 30 years ago. Unloaded it weighs just 2lb (0.9kg) and sits easily in the palm of the hand.

In gunshops in Vilnius, the capital of Lithuania, it can be bought for 590 litas - about £140 - but in Britain it changes hands for around £2,500. British criminals are drawn to it for two reasons: it is in plentiful supply and works to reliable and deadly effect.

The murder of Dre Smartt-Ford is testament to that. Eight months after he was shot dead, another teenager, Philip Poru, 18, was also killed by a bullet from a Baikal as he sat with a friend in a car in Plumstead, southeast London.

In Sheffield the gang warfare that led ten days ago to the murder of Tarek Chaiboub, 17, has been waged largely with Baikals. Chaiboub's friend and fellow gang member, Jonathan “Venomous” Matondo, 16, was shot dead with a Baikal last October. Police have so far refused to comment on speculation that the gun with which Chaiboub was armed when he was ambushed outside a barber's shop in the city was also a Baikal.

These gangland shootings were part of a spate of murders last year that prompted gun-crime summits and put added pressure on police to act. Gang leaders are thought to have responded by placing tighter controls on their armouries to stop the actions of hot-headed teenage members endangering their most valuable weapon.

One result is that knives have replaced guns as standard gang issue, especially in London, where teenagers seem willing to stab each other at will over petty disputes. But a victim of youth violence in the North West is much more likely to be shot than stabbed.

And the gun - especially the Baikal - remains the essential tool of organised criminal activity. According to the Serious Organised Crime Agency (Soca), criminals can obtain guns “easily” and a large proportion of gun crime, because it is criminal-on-criminal, “undoubtedly goes unreported”.

The Baikal is in daily use in the gun-crime hotspots of London, Manchester, Birmingham and Liverpool - protecting drug deals, coercing kidnap victims, threatening and taking life, facilitating robbery, enforcing protection and extortion and putting on a show of strength. Its use is also spreading, hand-in-hand with the drug trade, to other towns and cities.

The story of gangland's favourite gun begins at one of Russia's largest arms factories, Izhevsky Mekhanichesky Zavod. The factory dominates the city of Izhevsk, a place long associated with guns - the AK-47 was designed and built here and Mikhail Kalashnikov, now 88, still lives in the city.

For four decades, from 1951 to 1991, IMZ made the Makarov pistol, the standard sidearm for the Soviet military and police force. It was a simple design, cheap to make, and proved sturdy and reliable.

The Baikal IZH-79 is a direct copy of the Makarov, with the barrel modified to fire cartridges of CS gas instead of bullets.The modification was the Russian contribution to the growing market in “self-defence guns”, a step up from personal rape alarms. These are designed to fire clouds of tear gas, and are marketed in glossy brochures which show young women pulling handguns from handbags to fend off muggers and rapists. It comes off the production line in Izhevsk equipped to fire a clip of eight 8mm teargas cartridges.

In about 2001 Lithuanian gangs discovered the weapon's criminal potential. They realised that if the Makarov could be turned into the Baikal, then it ought not to be too difficult to reverse the process.

Criminals across Europe had been trying for years to turn a profit by converting cheap gas guns into expensive real guns. The problem was that gas pistols were generally made of weaker components than the revolvers on which they were modelled, and would simply break apart with the force of firing a live round. The Baikal was different for one reason: it is made entirely of steel.

In his office in Vilnius, Kestutis Tubis, deputy police commissioner-general, showed me an early conversion. The gun had come out of the Russian factory in 1999 and been modified to fire 5.45mm dumdum bullets. It was, Tubis believes, intended for sale to Russian criminals.

For several years, in backstreet garages and farm workshops, Lithuanian gangs experimented with barrels of different materials and calibres (diameters). They were also eyeing up lucrative markets in the West. In Britain, where handguns were banned after the Dunblane massacre in 1996, criminals had been finding it difficult to acquire firearms and the Lithuanian gangs found a hungry market. Such was the scale of the resulting illegal gun trade that the Lithuanian police joke that their criminals joined the European Union long before the rest of the country.

The pioneers of the trade were muscle-bound young men who acquired their introductions to British underworld circles by working as nightclub doormen. The British gangs - whites, Turks, Yardies and Asians - thought at first that they were dealing with Russians. But the ethnic origins were irrelevant; what mattered most was the commodity being offered for sale.

The arrival of the Baikal sparked a voracious demand for weapons. One consignment of ten smuggled Baikals that arrived in East London in 2006 sparked a bidding war, with 30 potential buyers vying at a Hackney nightspot to pay hard cash for a working gun.

Typically with a new business venture, there were problems with the supply chain. Some of the early Baikals arrived in poor condition, having been badly stored in transit from Lithuania. British buyers demanded modifications. They wanted guns that fired 9mm bullets, supplies of factory-made ammunition, and they insisted on silencers.

Today the experimenting is over and the trade is much more sophisticated. Batches of Baikals are often delivered to order, not simply smuggled on spec - and every new Baikal comes “boxed” (ie, new and unused) and ready to shoot. Typically it will be shrink-wrapped in heavy-duty polythene to protect it in transit (often hidden in a vehicle's fuel tank) and supplied to the buyer with 20 rounds of ammunition and a silencer.

“Lithuanians don't like silencers,” explains Tubis. “The bullet loses about a third of its power and the aim is less accurate. If you're shooting at someone some distance away it's impossible to target them. The silencers were developed for the British market.”

In Britain, accuracy is less important than silence. The shooting tends to be done up close - muzzles pressed into chests, chins and heads in nightclubs and on doorsteps.

The close-range killings of Smartt-Ford and Poru are, police and forensic scientists admit, among hundreds of unsolved shooting incidents in which Baikals have featured. Since the beginning of 2006 the number of open-case files on shootings involving 9mm ammunition - the type used in almost all Baikals now in circulation - has increased dramatically.

The number of Baikal cases may be even greater, but evidence is disappearing as the gangs become more aware of forensic science techniques. Investigators have seen CCTV footage of gang members “cleaning up” after a shooting - picking cartridge cases off the pavement before they flee the scene.

At the Metropolitan Police's Central Task Force, Detective Inspector Grant Mallon recalls the sudden rise in shootings around the beginning of 2006. Until then he had been dealing with poorer-quality weapons, until one raid netted his unit a haul of 9mm ammunition. “We were surprised because we'd been told that no one used 9mm,” he says. “From then on, everything was Baikals. Suddenly it went grown-up.”

Before the Baikal, gangland arms had been crude. Converted Brocock air guns were common, but inclined to explode in the gunman's hand. The bullets were usually “home-made” and sometimes had cardboard rolled around them to hold them in the gun. The Baikal, fitted with a 9mm barrel, British gangsters to fire commercially manufactured ammunitio(typically Russian Wolf or Czech Sellier & Bellot bullets).

“The conversions we see now are well-engineered,” says Tony Miller, a senior forensic scientist. “They use a steel tube which is properly rifled so that the bullet spins when it's fired. They don't jam and there are no problems with accuracy. There is no difference in performance to a real handgun.”

But a quick profit is not all that the Lithuanian gangs hope to gain. Guns are still a second-division commodity. What they really want is entry to the big league of organised crime - the Class A drugs trade, especially cocaine. One consignment of Baikals was traded recently with a London gang in return for an introduction to members of a Colombian drug cartel. Detective Inspector Mallon says: “The Baikal is what they bring to the table. What they want to take back is a route into the cocaine trade.”

Because organised crime knows no borders, the police response to the rise of the Baikal has needed to be international - but the law has been slow to react. Handguns are available legally in most of Europe, and only now is the EU drawing up plans for a central firearms register. Even so, there is extensive co-operation between British police forces, the intelligence-gatherers in Soca, the Vilnius police and the Lithuanian secret service.

In March this year, a police strike team drove through Baltic pine forests to Alytus, a neat but charmless town on the banks of the River Nemunas, 70 miles southwest of Vilnius. Here, in a garage on a dusty backstreet, they had identified a Baikal production line. The raids led to the arrest of Remigius Laniauskas and five other men - and the recovery of two Baikals and six Croatian-made Agram sub-machine guns.

The arrests attracted little attention, but last month Laniauskas was named in a British court as the head of an organised crime group that had been supplying guns using a garage in Tottenham, North London, as a front. The operation that smashed the network led to the convictions of two Lithuanian men and a woman, all living in East London, and the seizure of 13 Baikals, 17 silencers and 1,000 rounds of ammunition. This month, a group of British and Lithuanians will be sentenced in in Manchester in connection with the smuggling and sale of more than 50 Baikals.

By March this year, British police forces had recovered more than 250 Baikals. Even so, most police officers concede that, as with drug seizures, this probably represents just a fraction of those in the country. The uncomfortable truth is that no one knows how many Baikals are in criminal hands.

Commander Sue Akers, the head of organised crime investigations at Scotland Yard, concedes that there is a “real intelligence gap” on criminal weaponry. Bernard Hogan Howe, the Chief Constable of Merseyside, has angrily demanded that finding out how guns get on to his streets - and end the lives of children such as Rhys Jones - is made a priority. Even Kestutis Tubis cannot tell the true scale of the problem. With a deep shrug, he admits: “Only God may know this.”

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