Terror laws allowing the indefinite detention of foreign nationals without trial should be revoked, an influential parliamentary committee says.
The army took part in an anti-terrorist operation at Heathrow
MPs and peers on the privy council review committee made the call in their review of the 2001 anti-terror bill.
The committee members acknowledged measures against terrorism would be needed for "some time to come".
The report said: "Providing effective powers ... while protecting individual rights can be difficult."
Home Secretary David Blunkett was quick to respond to the report saying that he would look at all the committee's recommendation but adding he would be "failing in his duty" if he were to scrap powers to intern foreigners.
"These were not powers I assumed lightly. I have never pretended that they are ideal, but I firmly believe that they are currently the best and most workable way to address the particular problems we face," he said in a statement.
"I believe that I would be failing in my duty of public protection if the Part 4 powers were removed from the armoury of measures available to protect the United Kingdom from specific terrorist threats."
But the committee said Section 4 of the Anti-terrorism, Crime and Security Act 2001 - which allows indefinite detention - should be replaced with a measure that "does not require the UK to derogate from the right to liberty under the European Convention on Human Rights".
"Other countries have not found it necessary to have any such derogation and we have found no obvious reason why the UK should be the exception."
They added: "While this power has not been used injudiciously or excessively it raises difficult issues of principle and it does not meet the full extent of the threat - for example it does not deal with British nationals."
The BBC's chief political correspondent Mark Mardell said those close to Mr Blunkett say he accepts the law is "drastic", but argues that there is no viable alternative.
He said MPs would get the chance to debate the report's findings early in the new year.
The 2001 Act also includes measures tackling the incitement of religious hatred or violence, weapons of mass destruction and terrorist finance and property.
It also covers nuclear and airport security, extensions of police powers and retention of communications data.
Mr Blunkett set up the cross-party committee in April 2002 to report by this month on how the legislation was working.
In formulating their report they worked around two principles.
First, that individuals have the right to privacy and, second, that the authorities have a duty to take steps necessary to protect people from terrorism.
Lord Newton said: "It would be prudent to assume that the terrorist threat to the United Kingdom is likely to need a body of anti-terrorist law for some time to come."
But the committee warned that the 2001 Act should be amended so it did not trespass into areas unrelated to terrorism.
The report said: "The powers which allow public bodies such as the Inland Revenue to disclose information to help investigations and prosecutions, here and abroad, are not limited to terrorism cases."
David Blunkett introduced the Bill within weeks of the 11 September attacks
Amnesty International, whose report Justice Perverted looked into the Act, claims the laws are creating a "Guantanamo Bay in our own back yard".
The human rights group says foreign nationals are being denied the presumption of innocence until proven guilty.
It says the UK has created a different justice system for foreigners, who are held indefinitely without charge, and is not meeting international standards.