Researchers from the University of Sheffield found that the noise affects adult birds hearing of the hunger calls from their offspring, leading to their death from starvation.
In their study, the team found that birds nesting in noisy areas were less effective at feeding their chicks as those that nested in quieter places, the BBC reported.
The researchers, who detailed their findings in journal Plos One, carryied out the study on Lundy, a 1,100-acre island located near the North Devon coast.
Co-author Julia Schroeder said: "When I first went to the island, which is very remote and quiet - apart from gulls and shearwaters - I entered a barn and it was very loud."
The barn contained an electricity generator, yet sparrows were still choosing to nest in the building, so Dr Schroeder wondered whether the conditions affected the songbirds.
"I found that there was a reduced fitness -- a reduced reproductive output from the nest boxes located in the noisy area," she told BBC News.
So she decided to test her findings against classic hypotheses on how noise could affect birds' mating decisions.
However, the study's findings did not fit the existing hypotheses. "In our case, we saw that the birds did not feed the chicks as well as the birds in the quiet area - this was a novel idea that had not been shown before," Dr Schroeder said.
"Obviously, chick provision is strongly linked to chick survival because if they do not get fat then they die."
Noise seemed to interrupt the communication between the young birds and their parents, she observed.
"The only difference we found from normal behaviour was in the provisioning behaviour," she said.
"Chicks that were reared in the noisy barn were lighter when they fledged. So this is why we have said that we think that the provisioning behaviour of females is a factor."
In the last three decades, the UK's sparrow population declined by 71 per cent -- with some of the sharpest declines occurring in towns and cities.