MPs have signalled their anger at Tony Blair over the extradition to the US of three bankers to face a fraud trial.
Pleas for the bankers to be tried in the UK have been rejected
They voted by a majority of 242 to adjourn the Commons early in symbolic protest at the government's extradition arrangements after a three hour debate.
Lib Dem Nick Clegg told MPs Mr Blair had "short-changed" the UK by signing a "lopsided" extradition agreement.
Mr Blair insists the three men would have been extradited under the old rules, and says they will get bail.
The three ex-NatWest bankers - David Bermingham, Gary Mulgrew and Giles Darby - are due to be extradited to the US on Thursday in relation to the collapse of the energy giant Enron.
Critics say it is easier to extradite people from the UK than the US.
Pressed about the issue at prime minister's questions, Mr Blair said: "In the attorney general's view, the test that is applied by the United States, the one of probable cause, is roughly analogous to the one we apply in this country."
He said the "case for extradition was originally mounted under the old law, not the new law".
"I do not believe it would be right if we ended up applying a higher standard and burden of proof to America than we do to many other countries," he told MPs.
He said he "totally understood the concerns" of the three men's families, but said the US prosecutors had promised to grant them bail while they awaited trial, provided they met conditions.
Mr Blair also rejected demands by Liberal Democrat leader Sir Menzies Campbell to renegotiate the Extradition Act 2003.
But, speaking as he opened a rare emergency debate on the issue a few minutes later, Lib Dem home affairs spokesman Nick Clegg said Mr Blair's claims were "simply and totally incorrect".
He insisted the treaty was "unfair and imbalanced" and urged the government to ditch it.
'Tip of iceberg'
The government had admitted that the treaty was not reciprocal but back-pedalled on this position when the NatWest three case hit the headlines, added the Lib Dem home affairs spokesman.
And he said: "They are just the tip of the iceberg, their case has highlighted a wider problem.
"Namely that the government signed a lopsided treaty which short changes the interests of British citizens and those under our judicial protection."
He called on the government to revoke existing extradition agreements with the US and renegotiate them - and to give Parliament more of say in drawing up international treaties.
Solicitor General Mike O'Brien told MPs the test that existed between Britain and the US in terms of extradition was "one where the balance is not identical but it is very similar".
And, he added, the UK's Extradition Act was not designed just to deal with terrorists.
It was drawn up before the 11 September attacks on the US and would also be used to deal with serious offenders such as murderers, rapists, child pornographers, drug dealers and robbers.
He also said it was a "myth" that the NatWest Three case was about allegations arising from the UK only, as claimed by the Conservatives.
"They are innocent until proven guilty, but remember that in the US, Enron was the biggest fraud in history," said Mr O'Brien.
He did, however, agree to drop references to the "Enron Three", after Tory protests that this could be prejudicial to their case.
Shadow attorney general Dominic Grieve, for the Conservatives, had "some sympathy" with the government over extradition.
But the events surrounding the NatWest three had "exposed misgivings" on behalf of the public about the way the process was working.
He said ministers had allowed themselves to be treated like "patsies" when it had drawn up the 2003 extradition treaty and it should be looked at again.
Former Conservative leader Michael Howard attacked the "one-sided" arrangements and urged emergency legislation to prevent an "injustice".
He denied being anti-American but conceded he had had a disagreement with President Bush while opposition leader.
"I don't think that in order to maintain good relations between this country and the US it is necessary for the prime minister of the UK to be a poodle of the president of the United States of America," he told MPs.
MPs voted by 246 to four, a majority 242, to adjourn the debate.
Commenting afterwards, Sir Menzies Campbell said Labour MPs had not had the "courage" to vote on the issue and there was "very considerable discontent" among MPs and peers about extradition.
On Tuesday the government was defeated in the Lords, when peers called for extraditions to the US to be suspended.
Critics say the extradition laws are unfair because British citizens can be sent to the US without proof of the case against them - but there is no reciprocal arrangement.
They add that Britain should not enforce a treaty which the Americans have failed to ratify.
But the government argues that the arrangement means both countries have to produce an equivalent level of legal evidence when seeking extradition from the other nation.
The NatWest Three deny any wrongdoing but have lost their court battles to face trial in the UK.
One of the three, Mr Bermingham, said: "The difficulty we have is that everything we need to defend this case is here in the UK. This is a UK matter and the US connection is tenuous at best."
He said he saw himself as a victim to be sacrificed to the system before a change can be brought about.
Home Office minister Baroness Scotland is flying to Washington to appeal to the Senate to ratify the 2003 extradition treaty.