Most of the street suppliers were selling heroin, but the remainder were caught dealing ecstasy or cannabis.
"We're delighted this is being done. Heroin and cocaine are our big problem. Crack cocaine is emerging and the chances are it will get worse," said long-time community activist Sean Lambe of the Inner City Organisations Network (ICON).
In the north inner city, residents blamed the cocaine problem for an 'inexplicable' rise in suicides and claim there is now one a month.
Mr Lambe said there were five suicides last summer. "It is happening now at least once a month, mainly young men."
He was speaking after details emerged of phase VII of Operation Cleanstreet, carried out by the Garda National Drugs Unit along with local units.
A Nigerian national was apprehended after undercover gardaí bought three rocks of the highly addictive drug, crack cocaine, from him in Dublin's north inner city.
Gardaí also targeted the south inner city particularly the Thomas Street/Meath Street area as well as parts of Ballyfermot and Clondalkin, in south west Dublin.
Eight pubs and nightclubs were also included as part of the operation. Gardaí have begun arresting the 130 dealers.
A spokesman for the Coalition of Communities Against Drugs (COCAD) welcomed the operation.
But he said that those arrested needed to be charged and held on remand pending their trial.
"We need detention so that they are not let back out on the streets plying their trade once they're charged."
He said cocaine dealing and usage had 'gone off the scale' in recent years in inner city areas, with a sharp reduction in price.
He said the emergence of crack in the north inner city was replicated on the southside and pointed to a recent crack arrest in the Oliver Bond flat complex.
The latest phase brings to around 730 the number of street dealers arrested under Operation Cleanstreet since it started in 1997.
But Mr Lambe said most of those arrestedwere at the bottom of the supply ladder.
"People do want drugs off the streets, but these people are often victims, they are user-dealers."
He also said the general problem wasn't being addressed. Community and drug programmes are being savaged by cutbacks.
" The drug problem is fundamentally rooted in disadvantaged areas. Until we tackle that problem, to a large extent gardaí are wasting their time."
Meanwhile, gardaí yesterday said there were 200 drug seizures at last week's two Eminem concerts at Punchestown, Co Kildare, which attracted 100,000 people.