Home Office Security Minister Tony McNulty has admitted the government made mistakes in response to the 7 July 2005 bomb attacks in London.
Hundreds of people were injured in the 7 July attacks.
He said the government should not have treated the Muslim Council of Britain as the only voice of British Muslims.
At a Labour Party conference fringe meeting, he warned against rushing into laws in response to a terror threat.
Echoing Tony Blair's phrase on dealing with terrorism, he said: "Actually the rules of the game haven't changed."
The four suicide bombings on 7 July 2005 killed 52 people and injured nearly 800.
Mr McNulty told the meeting in Bournemouth: "I think we have made mistakes since 7/7."
He said one of these mistakes was Mr Blair's argument that people must be ready to accept reductions in their civil liberties in the fight against terror because "the rules of the game have changed".
Within weeks of the 7 July attacks, Mr Blair unveiled a raft of legislative measures to tackle terrorists, including tougher deportation and extradition powers, a new offence of glorifying terrorism and powers to close a place of worship.
But in his speech on Wednesday, Mr McNulty suggested that ministers had been too ready to adopt exceptional measures which could impact on the liberties enjoyed as part of the British way of life.
He distanced himself from the phrase "war on terror" stressing that terrorism should be tackled through "normal" rather than "exceptional" means.
"With the best will in the world, where we are at now as a government means that we are coming round to the view that says, actually, the rules of the game haven't changed..." he said.
"The more these things are tackled through normality, with some little exceptions on top, rather than absolutely by exception, the better.
"The more any response is rooted in our civil liberties and human rights, with whatever slight tweaks at the top, the better," he said.
'Music to my ears'
He said lessons had been learned from last summer's botched terror raids in London "by not rushing headlong into looking at legislation instantly and with very short shrift, but by taking the time to develop a broader counter-terrorism response by government in all its facets".
It was also a mistake to treat the Muslim Council of Britain as if it was the only voice of British Muslims and to "elevate it to an exclusivity that wasn't warranted", he said.
He said the MCB's response to the failed terror attacks in London and Glasgow this summer was "profoundly different" to 7/7 and he praised former communities secretary Ruth Kelly for "recalibrating" the relationship.
Mr McNulty was praised by Shami Chakrabati, director of civil rights group Liberty, who said his words were "music to my ears".
"The Angels are weeping in heaven tonight," she added.
Mr McNulty spoke out just a day after Home Secretary Jacqui Smith said the time was right to reconsider extending the 28-day limit on holding terrorism suspects without charge.
She told delegates that prevention of terrorism outweighed any potential damage to community relations. But Ms Smith ruled out extending the controversial period to 90 days.