Market research firm Gartner estimates that Apple's iPad will have a 73.4 percent share of the tablet market by the end of 2011, down from 83 percent at the end of 2010.
The data, released by Gartner today, shows that overall tablet sales are on course to hit 63.6 million units this year, a 261.4 percent increase from 2010.
Despite Apple's drop in market share, it is expected to be the dominant force in the tablet market for several years to come, Gartner said.
"We expect Apple to maintain a market share lead throughout our forecast period by commanding more than 50 percent of the market until 2014," Carolina Milanesi, research vice president at Gartner.
"This is because Apple delivers a superior and unified user experience across its hardware, software and services. Unless competitors can respond with a similar approach, challenges to Apple's position will be minimal. Apple had the foresight to create this market and in doing that planned for it as far as component supplies such as memory and screen. This allowed Apple to bring the iPad out at a very competitive price and no compromise in experience among the different models that offer storage and connectivity options."
Android-based tablets, however, will only account for 11 million of the total tablet sales in 2011, with Gartner having reduced its estimate for overall sales of Android tablets by 28 percent since the last quarter. Android's market share will hit 17.3 percent by the end of the year, up from 14.3 percent last year.
However, Milanesi sees a bright future for Android. "So far, Android's appeal in the tablet market has been constrained by high prices, weak user interface and limited tablet applications" she said.
"Google will address the fragmentation of Android across smartphone and tablet form factors within the next Android release, known as 'Ice Cream Sandwich,' which we expect to see in the fourth quarter of 2011. Android can count on strong support from key OEMs, has a sizeable developer community, and its smartphones application ecosystem is second only to Apple's."
Gartner did have a warning for Windows 8-based tablets, saying that new entrants to the tablet market would find it hard to compete with Apple and Android-based devices, which have already established themselves.
"Most of Apple's competitors are struggling to meet Apple's prices without considerably sacrificing margins. Screen quality and processing power are the two hardware features that vendors cannot afford to compromise on," said Roberta Cozza, principal analyst at Gartner.
"They should consider everything else 'nice to have,' rather than essential, in order to keep bills-of-materials costs competitive with those of the iPad."
However, the tablet market will continue to grow, with overall sales at the end of 2012 expected to hit 103 million and 326 million by the end of 2015, Gartner forecast.