Anyone cautioned or prosecuted for child pornography offences in the future will be banned from teaching, the Department for Education said.
The announcement was made as Education Secretary Michael Gove came under increasing pressure to explain why his department approved a decision to allow a teacher who downloaded indecent images of children back into the classroom.
The move sparked widespread condemnation and Gove has now been urged to appear in the Commons to tell MPs why Geoffrey Bettley, 36, was reinstated after police found nearly 200 child abuse images on his computer.
Geoffrey Bettley will be able to teach in schools, a disciplinary panel ruled
In a statement a DfE spokesman said: "We want to ensure that in future anyone cautioned or prosecuted for offences related to child pornography is prohibited from teaching.
"We are taking steps to revise the guidance the independent panel uses to make a decision on whether a teacher should be barred."
It is not clear whether the announcement is retrospective and will cover Mr Bettley, who had been suspended from St Mary's Catholic School in Menston, West Yorkshire in December 2010.
Bettley accepted a police caution and was dismissed by the school following a disciplinary hearing in December 2011.
But a professional conduct panel has ruled that the RE teacher should be allowed to return to teaching after concluding he "does not represent a risk to children and young people".
The decision was signed off by a senior official at the Department for Education.
Philip Davies, Conservative MP for Shipley, said that many parents would be "deeply disturbed" that Bettley had been allowed to teach again.
Speaking during the weekly Commons business statement, Davies said: "He downloaded child porn images and was rightly sacked by the school and put on the sex offenders register.
"In a decision which has been ratified by the Education Secretary, he's now been told he's allowed back to teach again.
"I'm sure you will appreciate many parents will be deeply disturbed someone who has been convicted of downloading child porn should be allowed to teach again.
"Can we have a statement from the Education Secretary so he can explain what on earth he was thinking about when he allowed this person to teach again?"
Commons Leader Andrew Lansley replied: "I have read the press reports relating to this matter and of course it was a decision taken by the National College of Teaching and Leadership, which was then endorsed by a senior official at the department.
"I will, of course, contact Gove so he might be able to give you an account of the process in this case."
In its judgment, the National College of Teaching and Leadership professional conduct panel said the images viewed by Bettley were "not at the most serious end" of the scale and there were "relatively few" on his computer.
The panel said it had considered it safe to conclude that the RE teacher "does not pose a risk to children".
While Bettley's actions were a "serious departure" from the official Teachers' Standards, the panel said, it added that it did not consider that there was evidence of "a deep seated attitude on the part of Bettley which leads to harmful behaviour".
The panel's report added: "In the circumstances, the Panel does not consider that it would be appropriate to recommend prohibition to the Secretary of State and it does not."
At the end of the Panel's report, under a section on the Secretary of State's decision and reasons, a senior DfE official said: "Although the findings in this case are serious ones, for the reasons set out, I support the recommendation of the Panel that a prohibition order should not be applied in this case."
Bettley was employed at St Mary's from September 2001 to December 2011.
He visited a website in March 2009 where he viewed six child abuse images, according to the panel's ruling.
When his computer was seized by the police in December 2010, 143 images were found at level one, which covers nudity and/or erotic posing.
A further 46 images considered to be at level three on the scale were found but had not been opened, the panel said.
Bettley acknowledged that the images were of underage children and were child abuse images and admitted to police that he had accessed and viewed the images, the panel said.
He was cautioned for the offence of possessing an indecent photograph or pseudo-photograph of a child and placed on the sex offenders register for two years, according to the ruling.
In the judgment, the panel said Bettley's conduct had brought his profession "into disrepute" but acknowledged the Independent Safeguarding Authority had since removed his name from the Children's Barred List and the Adults' Barred List.
A report from Leeds Children and Young People's Social Care in September 2011 had also concluded that Bettley posed little risk, the panel added.
A Department for Education spokeswoman said: "We keep the process under review because of legal complexities and we are examining whether this case was handled correctly."
A DfE spokeswoman later said that under current law, the announcement cannot be applied retrospectively.
All schools must carry out vetting checks when recruiting staff and a caution of the type Mr Bettley was given would be highlighted.