Government proposals to remove the automatic right to trial by jury have been thrown out by the House of Lords.
Barristers' groups are worried about eroding jury trial
Peers voted by 210 to 136 - a majority of 74 - against plans to allow defendants to choose to be tried by a judge alone, with no jury.
The heavy defeat undermines the other jury changes proposed by ministers and the government has already said it plans to reverse the vote in the House of Commons.
Earlier, Downing Street warned the government might drop the whole Criminal Justice Bill if the jury changes were not passed at the bill's committee stage.
Peers will on Thursday debate other proposals, including plans to allow complex fraud trials to be conducted without a jury.
But after the first vote, the Home Office said in a statement: "This is a bad day for jury members, who would continue to be intimidated by dangerous criminals if this vote were allowed to stand.
"We shall reverse this defeat in the Commons.
"These are sensible, limited and appropriately targeted measures that, far from undermining a fundamental principle of the legal system, will protect its integrity and improve public confidence."
That response was branded "disgraceful" by the Conservatives, who said ministers should give police more resources to tackle jury intimidation rather than undermining jury trial.
The bill is not expected to return to the Commons until October at the earliest.
That sets up a "ping-pong" battle between MPs and peers as the government tries to stop the plans running out of parliamentary time.
The proposals narrowly won the backing of MPs earlier this year after a rebellion by more than 30 Labour backbenchers.
Earlier, Conservative former cabinet minister Lord Hunt of Wirral said: "We urge the government to think again - juries are an essential part of a healthy democracy and represent public participation in the criminal justice system."
The government is concerned that jury trial is time consuming and onerous for juries, particularly in fraud cases.
But Lord Hunt, who is the head of a large law firm, said it was "patronising and wrong" to suggest juries were incapable of following complex fraud cases.
However, Metropolitan Police chief Sir John Stevens said scrapping automatic trial by jury was crucial for bringing gangsters to justice.
The changes would also save millions, he said. Giving jurors and families round-the-clock protection last year cost the Met Police £3.5m, rising to £5m this year.
Sir John said less than 100 cases would be affected, adding that it would be "an absolute tragedy" if the bill was kicked out because of the controversy over jury trials.
Labour's Baroness Kennedy of the Shaws said when she asked a colleague what the government had against jury trial, he replied: "It was about control".
Critical to democracy
She added: "But juries are beyond the control of governments, in a way that the judges sometimes aren't."
Lady Kennedy rebutted suggestions that juries would not understand complicated fraud trials, arguing that the conviction rate was 86%.
She said the measures were the "slippery slope", adding that juries were "very representative", unlike judges who were generally "white and male".
Lord Thomas of Gresford, the Lib Dems home affairs spokesman, said his party was backing the Tory move.
"The jury is an essential democratic institution at the heart of the system of justice in this country and any attempt to weaken it should be resisted," he told peers.
Sir John Stevens wants an end to jury intimidation
Cross-bencher Lord Ackner, a former law lord, said he feared the moves were driven by a belief that jury trials in long cases did not give "value for money".
This is the third time the government has tried to cut back on the number of jury trials. Previous attempts have foundered in the Lords.
Ahead of the debate, Mr Blunkett said the government was "not saying juries don't understand serious fraud cases".
Under the current system, evidence was pared down and charges reduced to make the length of the trial more manageable for the jury, he said.