City leaders spent 149,000 on lights and 37,000 on trees last year, according to documents released under Freedom of Information laws.
Charlotte Linacre, campaign manager at the TaxPayers' Alliance, criticised the expenditure.
She said: "We all want to enjoy Christmas and put up a few decorations, but taxpayers shouldn't be left with a bill running into millions at the end of it all.
"It's unbelievable that festive spending peaked during the recession and costs must be kept under control from now on.
In response, a spokesman for the council, said: "Christmas is a special time of year and there aren't many cities that can match what Edinburgh has to offer over this period.
"The festive lights and other decorations are an important part of showcasing the fantastic sights and experiences for residents and visitors."
Of 28 councils which responded to an FoI probe, North Lanarkshire recorded the highest festive lights bill last year at 352,000.