The country saw more than 6,000 cases of hidden spy camera filming reported in 2017, prompting a series of protests last year in the capital Seoul, with calls for tougher sentencing.
Four men have been detained in South Korea, accused of secretly filming 1,600 hotel room guests and selling the footage via a website.
The BBC reported the mini-cameras were installed in TVs, hair-dryer holders and sockets.
If convicted, the men face up to 10 years in prison and a 30 million won (US$26,500) fine.
The BBC said the covert filming of sex and nudity in South Korea has been described as an epidemic and has sparked protests.
Speaking to the BBC, Korean police said the men set up the 1mm lens cameras last August in 30 separate hotels across 10 South Korean cities.
In November, a website was then created, allowing users to pay for full videos or watch 30-second clips for free.
The men reportedly posted 803 videos and evaded the law by basing the website server overseas.
Police said the men earned money from 97 paying members before the site was taken down this month.
The country saw more than 6,000 cases of hidden spy camera filming reported in 2017, prompting a series of protests last year in the capital Seoul, with calls for tougher sentencing.