There is "no obvious" link between tough laws and levels of illegal drug use, a government report has found.
Liberal Democrat Home Office minister Norman Baker said the report, comparing the UK with other countries, should end "mindless rhetoric" on drugs policy.
He accused the Conservatives of "suppressing" the findings for months.
Prime Minister David Cameron said the research did not offer "specific conclusions" and said he did not "believe in" decriminalising drugs.
Drugs policy was debated in the House of Commons earlier, with Green MP Caroline Lucas urging the government to review "failing" drugs laws.
Under current laws, offenders can be jailed for up to seven years for possessing Class A drugs, and can be jailed for life for producing or supplying drugs.
The Home Office report compared the UK's approach to drug misuse with that of 13 other countries.
After examining a range of approaches, from zero-tolerance to decriminalisation, it concluded drug use was influenced by factors "more complex and nuanced than legislation and enforcement alone".
But it found there had been a "considerable" improvement in the health of drug users in Portugal since the country made drug possession a health issue rather than a criminal one in 2001.
The Home Office said these outcomes could not be attributed to decriminalisation alone.
But Mr Baker believes treating drug use as a health matter would be more effective, "rather than presuming locking people up is the answer".
'No-one chooses to be an addict'
Alex, a recovering heroin and crack addict from London
The majority of my family either suffer from addiction or have died as a consequence of it. I have buried two friends this year.
Addiction is a progressive illness. I started smoking cannabis when I was 18 or 19 at university.
I was abstinent in the army, but used alcohol in cross-addiction for about six years. I served in Iraq and was blown up in Basra. Post-Iraq, I worked in contract security and would use when I got back to the UK.
I'm 38. I got clean at 30 and go to 12-step fellowship meetings nearly every day.
I don't believe for one moment that the current laws deter any addict from using, to assume they do makes the assumption that addicts have control and choice.
The views of the Home Office are out of touch and most probably based in ignorance of what addiction is. No-one I know chose to become an addict.
The fact the Home Office is responsible for drug policy, including treatment, is alarming and probably why the UK is blighted with addiction.
Lib Dem leader Nick Clegg accused the Conservatives of a "totally misplaced, outdated, backward-looking view".
While Mr Baker said: "We've had what I would call mindless rhetoric over the last 40 years which has tended to say there is only one solution and anyone who offers any alternative must by definition be 'soft on drugs'."
He said the Conservatives had suppressed publication of the report because of the "inconvenient truths" it contained.
But Tory MP Michael Ellis, a member of the Home Affairs Committee, said the Lib Dems had "hijacked" it for political gain.
"Their frankly pro-drugs policy is dangerous and irresponsible," he added.
Mr Cameron said: "Under this government drug use is falling and I think that's because we have followed an evidence-based approach.
"We have been focusing on education and prevention and treatment - that is the right approach to take."
He said the report was "interesting", but added: "It doesn't draw specific conclusions.
"I don't think anyone can read that report and say it definitely justifies this approach or that approach."
Danny Shaw, BBC home affairs correspondent
The divisions within the coalition could not be more sharply exposed.
The official Home Office position is that its drug strategy is working.
Norman Baker, the Liberal Democrat minister with responsibility for drugs, says "radical" change is needed.
Mr Baker's claims have been fuelled by his department's own report, which finds no link between how tough a country is on drugs and how many people use them.
It's an important finding, but the study also makes clear that drug policy is highly complex - approaches which may work abroad can't necessarily be implanted into the UK.
The report said it would be "inappropriate" to compare the success of drug policies in different countries because data collection and many other factors differ between each one.
But it said "some observations can be made" and it was "not clear" decriminalisation has an impact on levels of drug use.
"Looking across different countries, there is no apparent correlation between the 'toughness' of a country's approach and the prevalence of adult drug use," it stated.
Nick Barton, of charity Action on Addiction, said: "Today's report once again highlights the need for addiction to be treated as a health condition, rather than a criminal justice one."
He said jailing drug users was "rarely a solution".
Danny Kushlick, the founder of the group Transform, which has been campaigning for the legal regulation of drugs in the UK for almost 20 years, said the report was an important step.
"For the first time in over 40 years the Home Office has admitted that enforcing tough drug laws doesn't necessarily reduce levels of drug use," he said.
Matthew Price, Europe correspondent, BBC News
Back in the 1990s Portugal was struggling with a heroin epidemic of almost epic proportions. One person in every 100 was a heroin addict.
Not everyone agreed with the approach that was adopted to try and end the problem. In fact, many on the right wing of politics were appalled when prosecutions for people using drugs were ended.
They didn't like the idea that addiction would be treated as a health issue, rather than a criminal one, that addicts would be given treatment and healthcare to help them overcome their addiction. Those voices have been silenced now.
Fifteen years later, and the number of people hooked on heroin has been halved, and there have been good results in terms of Aids infection, hepatitis infection and the like.
Back in the 1990s "we feared that Portugal could turn into a paradise for drug users", says Dr Jaoa Goulao, Portugal's national co-ordinator on drugs and drug addiction.
Thanks to the policy, that didn't happen, he says.
A separate Home Office report has called for a blanket ban on all brain-altering drugs in a bid to tackle legal highs.
Currently, when a legal high is made illegal, manufacturers are avoiding the law by tweaking the chemical compound and creating a new substance.
The government will consider legislation introduced in Ireland four years ago that bans the sale of all "psychoactive" substances but exempts some, such as alcohol and tobacco.