Footage broadcast by state-owned Vietnam Television (VTV) this week showed dozens of large bags containing the used contraceptives scattered across the floor of a warehouse in the southern province of Binh Duong.
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Police said the bags weighed more than 360 kilograms (794 lbs), equivalent to 345,000 condoms, according to VTV.
The owner of the warehouse said they had received a "monthly input of used condoms from an unknown person," state newspaper Tuoi Tre reported.
CDC: 'Don't wash, reuse condoms!'
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A woman detained during the bust told police that the used prophylactics were first boiled in water then dried and reshaped on a wooden phallus before being repackaged and resold.
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VTV said it was not clear how many of the recycled condoms had already been sold. The detained woman said she had received $0.17 for every kilogramme of recycled condoms she produced.
Neither she nor the owner of the warehouse were available for comment.