The latest research from GeoDirectory shows a commercial vacancy of 15.6% an increase of 1.4% in a year.
The figures cover the last quarter of 2016 and show Donegal has the third highest commercial vacancy rate in Ireland and is 2.1% higher than the national average.
The highest vacancy rate in Ulster was in Ballybofey at 28.8%, which recorded one of the highest vacancy rates in the country.
The other towns in Donegal included in the report were Donegal Town (14.1%), Bundoran (14.7%) Buncrana (15.3%) and Letterkenny (21.4%).
One key finding from the analysis is that counties on the west coast of Ireland tended to perform less well than their eastern counterparts, with Sligo, Leitrim, Donegal, Mayo, Galway and Limerick having the six highest vacancy rates in the country.
In the last year, commercial vacancy rates increased in 25 out of the 26 counties in the Republic.