The authority was fined £30,000 for failing to manage the risk of asbestos after a Health and Safety Executive (HSE) prosecution over the lapse at the Woolsthorpe depot in Bilborough.
A visiting contractor spotted debris on the floor of the building and suspected it may be asbestos-containing material.
At the time the material was found, on May 23, 2009, the building was being used by the council's Street Scene team, which is part of the council's neighbourhood services arm, working to maintain and improve the city's environment.
The building was used as storage, a mess room, garages and offices.
The findings means Nottingham City Council may potentially have to defend mesothelioma and asbestos claims in future years.
The HSE investigation found that when the city council purchased the depot in February 2005, an asbestos survey was carried out and the majority of the asbestos removed. However, due to the design of the building there was no guarantee that all the asbestos had been removed particularly, from joints in the roof. The council took the decision to contain any remaining asbestos in the building by painting the affected areas.
The HSE's investigation found that for more than four years during which the asbestos deteriorated, the council did nothing to prevent the exposure to asbestos of those working in, or visiting, the building.
Nottingham City Council pleaded guilty to breaching Regulation 4(10) of the Control of Asbestos Regulations 2006 and Regulation 5(1) of the Management of Health and Safety at Work Regulations 1999. Nottingham magistrates today fined the council £15,000 for each offence and ordered them to pay costs of £12,000.