By Robert Pigott
BBC Religious Affairs correspondent
RE teachers must provide children with a more sophisticated understanding of the subject in a post-11 September world, Ofsted says.
In many schools, religion is linked with contemporary religious and moral issues
After a five-year inspection of RE classes which began in the year of the attacks on the US, Ofsted says rote learning of RE is no longer adequate.
It says teachers should include ways in which religion is not always a force for good.
Increasingly pupils have been opting to study RE for GCSE and A-level exams.
Ofsted says that in England, which it covers, RE is being taught better.
In many schools, religion is linked with contemporary religious and moral issues, such as whether the war in Iraq was morally justified.
But all too often, say the inspectors, the exam system encourages "standard, mechanistic responses" running the risk of "trivialising significant religious issues".
It says students are often denied the profound understanding they need of the impact of religion on society.
"Religion is much more in the media than it has been in recent years" says Ofsted's Director of Education, Miriam Rosen, "and this is, of course, because of events like the bombings in London in July 2005 and the New York incident back in 2001.
"This has raised people's awareness of religion and raised the importance of considering religion's role in society, and the impact of it."
One of the most radical suggestions in Ofsted's report is that religion should be taught warts and all. The inspectors called on teachers not to shy away from controversy, but to accept in their classes that religion could be a force for bad as well as for good.
"Pupils should be taught that religion is complex," says the report, "and should be given the opportunity to explore that ambiguity."
'Solve issues themselves'
Angus Dawson, RE teacher at Royal Manor Arts College in Portland, has long found that pupils enjoy the ambiguity of religion, enjoying the "struggle between ideas" where there are often no right answers.
"We embrace the idea that religious ideas lead to conflict," said Mr Dawson. "The skills we teach (pupils) allow them to unpack the ambiguity and tension between ideas in a clear and straightforward way and to solve the issues for themselves."
But that level of achievement is too rare says Ofsted.
Miriam Rosen said: "They're not really concentrating on teaching about the role of religion in society and its contribution towards community cohesion. The very best are, but this is not consistently done."
Ofsted says attempts to raise standards are hindered by no curriculum
Schools minister Andrew Adonis said RE can help educate children about issues surrounding community, diversity and tolerance.
He said: "Religious education is an important academic subject in its own right but it can also make a positive contribution to pupils' broad personal development and well-being, as well as bringing in issues of community cohesion, diversity, tolerance and respect.
"We agree that the potential of RE to contribute to children's education and understanding in these areas should be fully realised."
RE has long suffered a lack of specialist teachers, but Ofsted focuses on weakness in how progress is assessed, and the way the curriculum is planned, for the inadequacies in the subject.
It says that lessons often fail to build on prior learning. There is no national curriculum in RE.
Instead, all 151 local authorities are responsible for developing their own locally agreed syllabus. Ofsted says that hinders attempts to raise standards in RE, and consistency, across the country.
And those improvements are overdue. Ofsted says only a quarter of schools - albeit on its fairly small sample - were recorded as producing "good" achievement or better in pupils. One in eight were failing to produce even "adequate" achievement.