Home Secretary Theresa May has said ad vans telling illegal immigrants to "go home or face arrest" were "too much of a blunt instrument" after the Government confirmed it would scrap the campaign.
The Home Office recently came under fire for using the ads, displayed on billboards carried by vans in six London boroughs, reading ''In the UK illegally? Go home or face arrest".
The department confirmed earlier it does not intend to roll out the campaign nationwide following an evaluation.
At the second reading of the Government's Immigration Bill, the Home Secretary said: "What I've done is looked at the interim evaluation in relation to the plans - and there were some returns achieved as a result of that.
"Politicians should be willing to step up to the plate and say when they think something actually hasn't been as good an idea, and I think they were too blunt an instrument.
"But we should also be absolutely clear about what used to happen under the last government.
"Under the last government if somebody came to the end of their visa, nobody got in touch with them to say to them that they should no longer be staying here in the UK.
"That is now happening as a result of the changes in the immigration enforcement and over the last year as a result of the work that's being done we've seen something around 4,000 people leaving the UK. It's absolutely right we're doing that.
"We won't be rolling out the vans, they were too much of a blunt instrument."
Liberal Democrat Business Secretary Vince Cable described the campaign as "stupid", while Labour accused the Government of using language used by the far-right National Front in the 1970s.
The campaign was banned by the Advertising Standards Authority (ASA) earlier this month for using misleading arrest statistics, but cleared over complaints that it was offensive and irresponsible.
The ASA received 224 complaints including some from groups representing migrants in the UK, legal academics and the Labour peer Lord Lipsey.
Liberal Democrat party president Tim Farron said it was down to the outrage of the British public that the "cheap political stunt" was scrapped.
He said: "It is right that this pilot scheme is scrapped and that these vans will not been seen on our streets again.
"The vans represented the worst kind of divisive politics and it seems only one immigrant went home because of them. This is a failed project and the Home Office should hold their hands up and admit it was wrong both practically and morally.
"It is important that our borders are protected and secure but this policy - driving a van around some of the most diverse communities in London - is not the way to deliver that."
The climbdown came as Labour attempts to introduce a package of measures aimed at tackling the problem of immigration from within the European Union.
Freedom of movement rules within the EU mean it is impossible to prevent European migrants coming to the UK to work, but the Opposition will attempt to tighten up laws to ensure a level playing field for Britons.
Ed Miliband has admitted that Labour made a mistake in office by not imposing transitional controls on migrants from Eastern European countries and the proposals being set out to amend the Government's Immigration Bill represent what the Opposition claims is the "first serious attempt by any party" to deal with the problems caused by EU migration.
The package also includes measures aimed at targeting illegal immigration and Mr Miliband's promise that large firms hiring a worker from outside the EU have to offer an apprenticeship in return.
Among the changes Labour will seek are new laws to make it illegal for employers to deliberately run shifts for foreign workers only, banning unsuitable housing being used as tied accommodation to offset the minimum wage, and increasing the fine for not paying the minimum wage to £50,000.
Mr Miliband's plan for firms who bring in foreign workers to be forced to create apprenticeships was condemned by business leaders when he unveiled it last month.
The British Chambers of Commerce denounced it as an ''apprentice tax'' while the Institute of Directors said it was ''completely removed from reality''.
Shadow home secretary Yvette Cooper insisted that Labour's plans, which also include trebling the maximum fine for employing illegal workers to £30,000, were in contrast to the Government's "gimmicks" such as text messages and "offensive" advertising vans.
She said: "The Government is failing to address the exploitation of low-skilled immigration in the labour market. Nor do they have any serious strategy for tackling illegal immigration.
"That's why we are setting out sensible and practical policies, instead of the Tory-led Government approach of resorting to ineffective and offensive ad vans, gimmicks or incorrect text messages to people who have lived here for 30 years."
Ms Cooper branded the "go home" vans a divisive gimmick and a complete failure that was beneath Mrs May and "ought to be beneath this Government".
She asked the Home Secretary to confirm remarks from Immigration Minister Mark Harper that only one person had left as a result of the vans but both Mrs May and Mr Harper appeared to deny this in the Commons.
Mr Harper could be seen mouthing "I never said that" when asked to confirm that only one person had called the hotline advertised on the ad vans - only after seeing a picture of them in the Guardian - while Mrs May shook her head.
Ms Cooper told the Commons: "This has not just been a blunt instrument, it has been a complete failure. Will you admit this has been a pointless gimmick from the start?
"The Immigration Minister (Mark Harper) said last week they could be rolled out around the country, instead she's strung him out and decided today it's a blunt instrument and she won't do it again.
"But why did you do it in the first place? Can you tell us how many people did return home because of this? The Immigration Minister has told people that in fact only one person returned as a result of these ad vans. Can you tell us how many have in fact returned as a result of your ad van approach?"
She went on: "You agreed to that slogan ("go home"). And you agreed to send it round communities whose parents heard it from the National Front in the 1970s and whose British citizens work in our public services, build our businesses and fight in our armed forces today.
"You signed this policy off, you defended it, all for the sake of one person returning. You should be better than that. I hope you are ashamed of what you did.
"You should confirm that you will never pursue such divisive gimmicks again, it is beneath you and it ought to be beneath this Government."
Rachel Robinson, policy officer for Liberty, said: "Driving National Front-style slogans around diverse areas of London proved as ineffective as it was offensive.
"But rather than learning its lesson, the Home Office again seeks to cover up departmental delays and dysfunction via its irresponsible Immigration Bill - transforming landlords and bank managers into border officials rather than getting its own house in order."
Keith Vaz MP, chair of the Home Affairs Select Committee, said: " I welcome that the immigration vans will never be seen again.
"The vans were divisive and the tone of the campaign was badly misjudged. The campaign wrongly targeted members of Britain's ethnic minority communities who are here legally.
"The Home Office must think carefully about the implications of gimmicks such as these before they embark on a similarly disastrous pilot again. We still need to know how many people actually went back as a result of this ill-thought out scheme."