Imprisonment is "an extreme and expensive form of punishment which should be used as sparingly as possible", the all-party Commons home affairs select committee said.
If achievements were not to be lost, the incoming government after the election would have to make the rapid increase in prisoner numbers a priority issue, the MPs urged.
They suggested that some categories of offender should be diverted away from the prison system altogether, and called for a review of the extent to which mentally disordered people were being detained in jails instead of receiving the treatment they needed.
In a report distinctly at odds with the Government's preoccupation with punishment, the MPs praised the service's emphasis on decent conditions and purposeful activity for prisoners, but said the Government should go further and seriously consider allowing prisoners to earn the privilege of having televisions in their cells.
Only around 20 jails offer the facility, although not as a regular feature of their regimes, and the idea has received a frosty reception by Michael Howard, the Home Secretary.
But the MPs insisted: "[Television can keep a prisoner occupied (sometimes purposefully, depending on the programme) . . . this is an area to which the Government should give further consideration, given the potential of television in cells as a means of contributing to good order in a prison; so long as the availability of television in this way is clearly an earned privilege rather than a right, it may be that the public would not regard it as an excessive luxury for prisoners."
MPs said that rapidly increasing numbers of prisoners above forecast rates in recent months risked threatening the progress already achieved by the service, whose objective should be regimes which were secure but also "humane and decent" and aimed at rehabilitating offenders.
As at last Friday, the jail population in England and Wales stood at 59,530, a few hundred short of normal capacity and an increase of around 6,000 over the past 12 months.
"We consider that the prevention of prison overcrowding must remain a major priority," the MPs said.
"The situation is very finely balanced and could change - over a short period - from being under control to giving real cause for concern if forecasts of required accommodation or if planned expansions in capacity are frustrated."
On the latter point, the report warns that the building of new jails planned to tackle the impact of tougher sentencing legislation now going through Parliament "may not be so easy" because of public objections to jails being built in their "backyard."
Paul Cavadino, chairman of the Penal Affairs Consortium, an alliance of 33 penal organisations, said the report underestimated the impact of the rising population and budget cuts.
He said: "In prisons throughout the country overcrowding is worsening, prisoners are being confined to their cells for longer periods and education is being severely cut.
"Resources which should be devoted to improving regimes are being squandered instead on coping with rising numbers by makeshift methods which range from prefabricated houseblocks to prison ships."Reuse content