The Common Travel Area between the UK and the Republic has existed since 1925
The government has been defeated in the Lords over plans to introduce controls over people travelling between Great Britain and the Republic of Ireland.
Travellers are allowed passport-free movement on air and sea routes as part of the Common Travel Area.
Peers voted by 193 to 107 to remove a clause from the Home Office's Borders, Citizenship and Immigration Bill.
It would have introduced the right to impose controls over those travelling between the two jurisdictions.
Security Minister Lord West of Spithead said "traffickers of all kinds" were exploiting the open border of the Common Travel Area and "something has got to be done to block this breach in our defences".
He said he felt there was "some confusion and wild speculation out in the undergrowth" about the clause.
"The only change will be that there is legislation in place, to allow focused, intelligence-led operations. At present, there is no unequivocal legislative cover for such operations. We require them.
"Since 1997, the Republic of Ireland has introduced border controls so that third country nationals travelling from within the CTA to the Republic by air or sea must present a passport or ID card.
"The changes to our legislation mean that under this Bill travellers by air and sea to the UK from the Republic of Ireland must carry a passport or national ID card.
"As regards the land border in Ireland, we do not intend to impose controls and there will be no requirement for a passport or ID card. There will a growth in intelligence-based operations that will be clearly legitimised by this Bill.
"I state categorically that this Bill has no impact on journeys from Northern Ireland to the mainland, which is of course a domestic journey within the UK."
Conservative peer Lord Glentoran said the government claimed there were no plans to remove the Common Travel Area "but at the end of the day this Bill tells us clearly that they are intending to do so".
"They say that there are places that are not going to require passports but might do so. There are also places where the government don't know what they want at present but might want some form of identification.
"When it comes to the land border in Ireland, the minister has said the government have no intention of doing anything there but when you have listened a bit longer and look a bit further you find they might be doing something.
"The people of Northern Ireland see this part of the Bill as another way of getting rid of them, out of the United Kingdom."
A Liberal Democrat amendment preventing the Bill from being used to impose ad-hoc immigration checks on the border between the Republic and Northern Ireland was carried by 176 votes to 92, a majority of 84.
A Conservative amendment to the section dealing with the immigration appeals procedure was carried by 137 votes to 80, majority 57.