The foreign secretary has told the Commons that a court of appeal ruling could affect future intelligence-sharing with the US.
The judgement followed disclosure by a US court of seven paragraphs of a British summary of US intelligence detailingmistreatment of Binyam Mohamed over two years while he was held in GuantanamoBay.
David Miliband told the House that the case is "in many ways unique" and the government accepts the court's ruling.
Mohamed, an Ethiopian national, was granted refugee status in the UK in 1994.
He was detained Pakistan in 2002 and taken to Guantanamo in 2004, where he was tortured with the knowledge of British agencies.
He was released in February 2009, the first inmate from the US prison camp freed since Barack Obama took office.
Mohamed brought proceedings to get disclosure to his counsel of the information that the UK held.
The government appealed on the basis that intelligence provided in trust should not be put in public domain.
To do so would be a breach of trust so grave it would endanger intelligence-sharing arrangements and national security Miliband said.
He said the court of appeal had upheld the principle of control so integral to intelligence-sharing and the judgement "vindicates" the "careful assessment" that the public interest would be damaged by releasing the intelligence without US permission.
The seven paragraphs were published on the foreign office website this morning.
They show Mohamed was deprived of sleep, shackled and offered inducements, but there is no information about his claims of genital mutilation.
Miliband said the case showed the system is working.
Shadow foreign secretary William Hague said the opposition had long argued that the UK should have asked the US for permission to release the information.
"If they had done so we would have arrived at the same outcome without a year of legal proceedings," he told MPs.
He welcomed the judgement and "the need for openness in this case".
Mohamed's treatment was not just "utterly unacceptable" and "morally wrong" but served to undermine the fight against terrorism and weaken the UK's national security, he said.
Hague asked if the "unique" intelligence-sharing relationship with the US has been damaged by the court of appeal ruling and if any other countries have warned they will reconsider the basis on which they share intelligence.
Miliband said the British government chose not to "launch a campaign" for the US to release documents.
He said it was not the case there would have been the same outcome because there would not be court of appeal's ruling on the importance of contol.
The foreign secretary said the Obama administraion has shown its commitment to reviewing all cased of alleged torture, but chose not to release thedocuments.
Miliband admitted there could be a "chilling effect" on intelligence-sharing, which is a matter of "grave concern".
The UK would highlight the court's ruling on control to the US authorities.
"It will be an important job for me to minimise any effect on intelligence-sharing," he added.
"It is too early to say there will be no such effect."
Ed Davey, Lib Dem spokesman on foreign affairs, told Miliband he should be more contrite given that one of the most senior judges in the country has cricitised his actions.
He said his party "respects" the control principle but it was a "duty" of the government to ask the US to release the information.
Britain knew that the US was using torture against Mohamed, he said.
"What steps did they take to deplore that use of torture," Davey asked.
He called for a guarantee that "at no stage" was the UK in breach of domestic or international rules on torture.
Davey asked if there was knowledge of use of torture was across the higest level of government and called for a "wide-ranging" judicial inquiry.
Miliband said Davey "does himself no justice" in asking questions about matters that are before the courts.
It is not right to seek answers to questions that could prejudice an ongoing police investigation and that investigating officers "have been given all relevant papers".
Diane Abbott (Lab, Hackney North & Stoke Newington) asked why the foreign secretary described the court's ruling as a "vindication" given he has been forced to reveal information.
She said the information did not clear the government of involvement with extraordinary rendition and complicity in torture.
There are still questions to answer about past British involvement, Abbott said.
Miliband said the vindication is of the control principle and there are no outstanding questions to answer about extraordinary rendition.
Keith Vaz (Lab, Leicester East) asked when will police come to a conclusion.
Miliband replied it is not for the police to provide a "running commentary" on their investigations.
Douglas Hogg (Con, Sleaford & North Hykeham) said Mohamed was systematically mistreated, "probably amounting to torture," while in US custody.
He asked when the government first learnt those facts and what steps were taken to stop it.
Miliband said it was the actions of the government that led the documents being released to Mohamed's legal counsel and it is "at the heart of the government's case" that he had a chance to seek redress from the law.
