A complete ban on smacking has been rejected by ministers, after a review suggested most parents opposed one.
The review found many parents opposed a total smacking ban
Laws were tightened in England and Wales in 2004, but minister Kevin Brennan said they appeared to be working and would not change further.
He told MPs that while many parents said they did not smack children, most said it should not be banned outright.
He said it was the "common sense position" but campaigners said the decision was a "missed opportunity".
Laws on smacking in England and Wales were tightened in 2004 to stop parents and carers who assaulted children using "reasonable punishment" as a defence.
Under the 2004 Children's Act, which came into force in January 2005 mild smacking is allowed but any punishment which causes visible bruising, grazes, scratches, minor swellings or cuts can result in action.
The government has been reviewing the law to see if it was working - some organisations have called for a ban on smacking altogether, including the children's charity the NSPCC.
In a statement to MPs Mr Brennan said: "The review found that smacking is becoming a less commonly used form of discipline as more parents recognise that there are more effective and acceptable methods of disciplining children."
He said police had discretion to deal with cases they considered appropriate, and the law had improved protection for children - although some people were not aware of the change.
"In response, the government will retain the law in its current form, in the absence of evidence it is not working satisfactorily.
"We will also do more to help with positive parenting."
Later he told BBC News 24 "about 70%" of parents did not want a ban on smacking and did not want a mild smack to result in a parent being criminalised.
"I think that is the common sense position and we've decided to keep that, and are happy that strikes the right balance," he said.
For the Conservatives, Tim Loughton said: "Clearly, if any adult is responsible for abuse and violence towards a child they need to face the full rigour of the law.
"But there is a world of difference between that and criminalising loving parents that use chastisement as they see fit in the interest of their child."
He added: "There was never any public appetite for re-opening this can of worms just three years after the issue was debated in Parliament."
But Children's Commissioner for England Sir Al Aynsley-Green said it would send out "confusing messages" to parents and was a "missed opportunity" to protect children from violence in the home.
"Children and young people should have the same right to protection under the law on common assault as that afforded to adults," he said.
"There is no good reason why children are the only people in the UK who can still be lawfully hit."