The video entitled "Orange UFO on the Shropshire/Wales border" was filmed on May 1 and appears to have been shot in the early evening.
Phil Hoyle, from the Shrewsbury-based UFO Investigation and Research Unit, today said the lights did not appear to be Chinese lanterns and claimed they could not be explained.
He said the unit received a number of sightings and videos and images from people in Shropshire and Mid Wales. He said that although many could be dismissed as military aircraft or helicopters, a number are much harder to decipher.
Mr Hoyle said: "The video has allegedly been taken near Welshpool and it is inconclusive as to what the lights are.
"There are a number of things that are going on all down that border region as well as Newtown and into Radnorshire.
"A lot of these sightings are definitely not Chinese lanterns because of their sheer size. We are trying to trace the person who took the footage."
Meanwhile, according to the results of a new "star count", just one in 100 people have truly dark night skies where they live.
The Campaign to Protect Rural England (CPRE) and the Campaign for Dark Skies, who organised the star count earlier this year, said the results showed that, despite some work to reduce light pollution, the problem remained across the country.