By Tadhg Enright, Sky News Correspondent
The Government has been accused of "backpedalling" over a Home Office report suggesting heavy penalties for illegal drug use make no difference.
The report, which is based on international evidence, found "no apparent correlation between the 'toughness' of a country's approach and the prevalence of adult drugs use".
It has led to another split in the coalition, with Lib Dems supporting its proposed reforms and the Conservatives opposing them.
Deputy Prime Minister Nick Clegg said the survey showed the "war on drugs" was failing.
He added there was now an urgent need for change and accused the Conservatives of a "totally misplaced, outdated, backward-looking view" of the issue.
The Lib Dem leader was backed by crime prevention minister Norman Baker who reacted angrily to suggestions the party was going soft on drugs.
"Nothing in the report talks about letting off drug dealers Scott free and that's not Lib Dem policy," he told Sky News.
"I fear this is Number 10 backpedalling because they have got inconvenient facts.
"The facts are we've got an independent study conducted by civil servants and some of my conservative colleagues apparently don't like some of the evidence that has come out.
"But if you look at a tree, it's a tree."
Downing Street hit back, warning the Lib Dems' calls for decriminalisation sent "an incredibly dangerous message" and insisting there would be no change in the current approach.
"The Lib Dem policy would see drug dealers getting off scot-free and send an incredibly dangerous message to young people about the risks of taking drugs," a Number 10 source said.
"As the report makes very clear, the Government's approach already provides a good balance between enforcement and treatment, drug use is plummeting as a result and there is simply no chance that we will entertain such a reckless change of course."
The dispute broke out after the Home Office finally agreed to release the study - which the Lib Dems had originally commissioned - comparing drugs policies in different countries.
It was published alongside another report which recommends so-called legal highs be criminalised.
Both coalition parties support a ban on their sale, which has been welcomed by campaigners including Maryon Stewart, whose daughter, Hester, died in 2009 after taking a lethal cocktail of alcohol and the legal substance GBL.
She told Sky News: "I think everyone agrees that there needs to be change, what's happening right now isn't working."
An opinion poll in The Sun suggests for the first time, most Britons believe the war on drugs can never be won.
Some 71% of those surveyed said the war had failed, while 51% said it will always be doomed. The survey found 65% supported a review of drugs policy.
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