The PSNI believe 22 young people, aged between 13 and 18, have been sexually exploited in return for drink, drugs and gifts.
The inquiry follows a review of cases where young people have gone missing from the care system over the last 18 months.
The officer in charge of the investigation says some of those involved have previously been investigated for sexual offences against children and more than 30 arrests have been made so far.
A number of people have been charged, some with non-sexual offences such as drug crimes.
Detective Superintendent Sean Wright said: "This is a complex case and it is that complexity, not the numbers, which makes it difficult.
"We haven't identified a sex ring, but we are looking for it."
I think there are more cases yet to be identified - the scale of that we don't know.
Detective Superintendent Sean Wright
"The complexity is such that we have people engaged in trying to exploit children who don't understand the risk."
He revealed that many of the children know each other and that the "vast majority" did not see themselves as victims.
"Where a victim doesn't see themselves as a victim, they tend not to co-operate with the police, social services or any of the other statutory services who want to bring these perpetrators to justice," Det Sup Wright added.
"Victims tell us that the person who had sex with them, or took them to a party and gave them drink and drugs and encourages them to perform sexual acts on their friends, is actually their boyfriend and they love them dearly.
"So there is no way on this earth that they are going to give us a statement to put their boyfriend in jail."
On Friday, UTV exclusively revealed that a police inquiry had been launched into the scandal.
It is believed that more than one gang of men could be involved in the exploitation ring and around 150 people are suspected of wrong-doing.
Detectives, who suspect paramilitaries are involved, have appealed for more victims to come forward.
Police from elsewhere in the UK with experience in cases such as this have been drafted in to assist with the inquiry.
Mr Wright continued: "We identified early on that there were experiences elsewhere in the UK around similar issues so not only did we bring in senior police from greater Manchester to give us the benefit of their experience but also senior prosecutors, health officials to try and learn as a collective as to how they responded."
We will do our best to ensure we reduce the opportunity for people to engage in exploitation of children and young people.
Health Minister Edwin Poots
Meanwhile the Health and Justice Committees have held a joint meeting on the abuse scandal at Stormont.
PSNI Assistant Chief Constable Mark Hamilton attended alongside a Health Board representative.
"People who are involved in this type of criminality at the minute, I'm not saying they're not sex offenders - clearly they are and they are predatory," Chief Constable Hamilton told the committees.
"Some of them don't see themselves in that sense but they happen to fall neatly into the patterns that we as a society, view sex offenders."
Sinn Féin MLA Maeve McLaughlin raised questions over whether statutory agencies had done enough to prevent these offences, particularly within the Department of Health.
But Health Minister Edwin Poots said the blame should be focused on the perpetrators.
He stated: "I think most of the voluntary organisations if not all of the voluntary organisations recognise that the Department of Justice and the Department of Health, Social Services and Public Safety have never been working more closely than at this point in time."
This is without doubt the largest case of child sexual exploitation we have come across in Northern Ireland.
Neil Anderson, NSPCC Northern Ireland Head of Service
In a statement, the Health and Social Care Board stressed that it is vital that all agencies in NI work together to identify and respond to cases of child sexual exploitation.
Tony Rodgers said: "There is an effective multi-agency approach in place and social care professionals have been working with the Police, the Safeguarding Board, and the voluntary sector, including Barnardo's and the NSPCC to ensure there are robust arrangements in place to protect children.
"Learning from England indicates that children in care are very much a minority in terms of the overall numbers of children who are victims of child sexual exploitation, and that the majority of children affected live at home with their parents.
"The dangers lie in society and require society to tackle it as a whole."
Neil Anderson, NSPCC Northern Ireland's Head of Service, said: "As the details of this investigation begin to unfold, I want to stress NSPCC's commitment to working closely with other safeguarding and child protection agencies to ensure a coordinated response to the support of victims.
"NSPCC's first contribution to a multi-agency response has been the provision of a dedicated NSPCC helpline 0800 389 1701, implemented specifically to support this investigation.
NSPCC telephone: 0800 389 1701
"The helpline, operated by the NSPCC, is staffed by professional, trained and experienced child protection practitioners. Our staff will provide 24 hour advice and support to callers so that protective action can be taken to safeguard children and young people. Callers to the helpline can remain anonymous."