Interviewed by Kate Adie on BBC Radio 2 for its World of Faith week, Dr George Carey said children who transgressed should be slapped as long as it was "done with love".
Dr Carey - a father-of-four, who has five grandchildren - said morality started in the family. "It starts when parents bring up their children with firm boundaries," he said.
"You say `don't do this', `You mustn't do that' and you gently slap them if they do transgress, and there is nothing wrong with that as long as it is done with love and with firm discipline within the family set-up."
He added: "As they grow up, they learn and understand these rules and of course it has to be lived out. We older people must practise what we preach. So I don't think we pontificate from on high. We actually live the kind of discipline we are wanting a future generation of young people to grow up with."
A spokeswoman for Dr Carey affirmed last night that he would not be backtracking on his pronouncement - which was in response to a question on the need to lay down moral guidelines.
His press officer, Lesley Perry, said: "It's very clear ... he's answering a question Kate Adie asked him about what was needed (to bring up children) rather than general philosophies.
"It was part of a long interview he gave on a variety of things. Kate Adie asked him a whole series of questions of which that was just two paragraphs out of a half-hour interview. So it's very minor. There was far more to the interview than that."
Dr Carey's comments drew criticism from The Children's Society, which said there were more positive and constructive ways of instilling rules than by resorting to smacking.
"Our emphasis is to look at how you can give parents more constructive ways to respond. There are a lot of other ways in which you can instill discipline - like speaking to your children," said spokeswoman Rachel O'Brien.
"I think there's a danger of thinking smacking can achieve a lot. I don't think it can."
Ms O'Brien added that parents often turned to smacking when they felt harassed themselves, and not because the children had crossed behavioural boundaries. And she said the lack of a definition for smacking meant it should be opposed.
"We have to make a distinction between abuse and violence, and what Dr Carey's talking about - but the problem is there's no definition.
"What's one person's smack is another person's hit and that is why we have to place the emphasis on other ways of dealing with children," she said.