Spanish daily El Mundo on Monday reported on the German Sunday paper's media giant's damning portrayal.
The article notes the traditional popularity of the island as a holiday destination for German families and young people, and as a retirement destination for the elderly.
Majorca is so well-known it is said to be the best-known Spanish word in Germany.
But Sunday's report could also affect the public image of the island, sometimes affectionately known as "state number 17" in reference to the 16 federal states that comprise the German Republic.
The Bild am Sonntag article, titled Majorca's Darkest Summer, concludes that the economic crisis is ruining the island.
It states: "Swindlers, pickpockets and cheap prostitutes dominate Palma beach after sunset," before going on to claim that Majorca's crisis-related 30 percent unemployment level has left it in the hands of criminal gangs.
A total of 74,573 crimes were reported last year on the island and the feature's authors say they were advised by doormen at a club in the Ballermann area of Palma beach, to "hold on tight to your mobile phone".
The article also highlights the efforts of Aurelio Vázquez, president of Majorca's Hotel Business Federation, to have more police watching the beach at night.
But the feature's author says gangs seem unconcerned by law enforcement efforts: "I am not afraid of the police," one Senegalese man told the reporters.
"Majorcan justice is overwhelmed," businessman Utz Claasen, co-owner of Real Mallorca Football Club is cited as saying.
Tourism in Majorca relies heavily on the 4 million Germans who visit the island each year.
The report in Bild am Sonntag — the Sunday edition of a newspaper which calls itself the "most influential 200g of paper in the world" — could have devastating consequences for Majorca's tourist industry.