Labour rebels joined opposition MPs to slash Labour's 66-strong majority to the lowest level since 1997 as they inflicted a crippling blow to the legislation just hours after Mr Blair insisted that the Bill was vital to protect Britain's security. Labour left-wingers said key parts of the Terrorism Bill were "dead" after 34 Labour MPs rebelled over proposals to create a new offence of "glorifying" terrorism.
Following an angry seven-hour debate, Charles Clarke was also forced to offer a climbdown on contentious plans to give police powers to hold terror suspects for 90 days without charge after an open show of defiance from Labour MPs.
The Home Secretary admitted there was "no consensus" between the parties on an extension to the current powers to hold people for 14 days without charge.
He promised urgent talks between the parties aimed at reaching a compromise, after facing an afternoon of anger across the Commons.
David Winnick, Labour MP for Walsall North, withdrew a compromise plan to increase pre-charge detention to 28 days after Mr Clarke's concession. Mr Clarke told MPs yesterday: "The fact is there is no consensus in the House on this particular state of affairs and my view is we ought to seek consensus because we need the strength of a consensus."
The key revolt came as MPs were debating the Bill clause by clause on the floor of the Commons.
They voted by just 300 to 299 against a move by Labour left-wingers to ensure that prosecutors have to prove intent before bringing people who praise or glorify terrorist acts before the courts.
The Government's most recent scare was when the Bill introducing university top-up fees scraped through the Commons by just five votes before the general election.
Just hours before yesterday's vote, Mr Blair had attempted to stamp his authority on the Commons, declaring during Prime Minister's Question Time that the Bill was vital for national security.
He told MPs: "Each member of the House is going to have to take a decision on the terrorism legislation later today. We are doing it because the police, the head of the anti-terrorist operations in this country, say they need these powers to protect British citizens. Of all the things that we should debate today, that is important to the lives of people in this country."
The scale of the backbench rebellion over "glorification" took Labour whips by surprise. One said: "That doesn't bode well for the rest of the Bill's passage."
>But Labour left-wingers, already scenting the Prime Minister's blood following the resignation of David Blunkett, were jubilant. Bob Marshall-Andrews, the MP for Medway, who tabled the rebel amendment, said: "It's as good as a victory. That part of the Bill is unsustainable and cannot proceed. It cannot get through the Lords no one can tell the Lords that this is the will of the people."
The torrid passage of the Terrorism Bill through the Commons echoing the prolonged parliamentary battle over control orders in March sets the scene for a savaging of the Government's proposals in the House of Lords.
Peers have already protested that the "glorification" proposal is so vaguely drawn that it could criminalise people who advocate campaigns of resistance to despotic regimes.
The Bill was drawn up to counter the threat of terrorism after the bomb attacks on London on 7 July. Ministers are determined to rush the Bill on to the statute book by Christmas, but opposition parties and Labour left-wingers declared that the controversial measure was in deep trouble.
Mark Oaten, the Liberal Democrat Home Affairs spokesman said: "It is increasingly clear that the Terrorism Bill does not have the confidence or support of the House of Commons.
"The Home Secretary should act now to amend this illiberal and dangerous piece of legislation."
The Socialist Campaign Group of Labour MPs said that the Bill should be abandoned. John McDonnell, chairman of the group, said: "Such a show of widespread opposition shows that this Bill is now dead in its current form.
"This vote is a clear signal to the Lords to kill off the Bill and any subsequent attempt to remove our key civil liberties. The Government has now been forced into a position where it has no alternative but to accept substantial amendments."
Shami Chakrabarti, director of the human rights pressure group Liberty, said: "The Government's near-defeat on the intent amendment clearly shows that across Britain there is great concern about this attack on free speech.
"There should be equal concern about the re-introduction of internment the shocking 90-day proposal should not be reduced to 28 days or any other arbitrary figure. Pre-trial detention powers should not be determined by auction."Reuse content