Health Secretary Alan Milburn said the number of people waiting for surgical operations had fallen by 26,000 in the first three months of the year.
" This is the biggest fall since records began "
This, he said, meant Labour had met its 1997 election pledge to reduce hospital waiting lists by 100,000. The figure now stands at 1,006,600 compared with 1,158,000 when the party came to power.
Mr Milburn said the figures, released on Friday, showed Labour was delivering on the NHS - a claim hotly disputed by the Conservatives and Liberal Democrats.
The Opposition parties suggest that Labour's focus on waiting list numbers has meant hospitals have distorted clinical priorities in order to reduce the figures more quickly.
Speaking at Labour's daily news conference in London, Mr Milburn said: "In March 1997, we said we would cut waiting lists by 100,000.
"We have exceeded that. They have fallen by 150,000 with Labour."
"The Conservatives claim waiting lists are higher. Their claim is wrong. Mr Hague should now take his posters down. They are no longer believable, much like his tax and spending programme."
Policy under fire
But the Liberal Democrats say Labour's failure to tackle the problem sooner has caused suffering for many patients.
Its health spokesman Nick Harvey said: "Are Labour really expecting a pat on the back for doubling waiting lists, and achieving a big drop in figures in the month before polling day?
"The pledge card promise has been a cross to bear for four years. It has distorted priorities and meant the number of people waiting to get on waiting lists has soared.
"The fact is that waiting lists are still higher than when Labour came to power. Hundreds of thousands of people have suffered pain and misery because Labour woke up far too late to the need for investment in doctors and nurses."
'Obsessed with spin'
Shadow health secretary Liam Fox said Labour was "spinning" the figures.
"Labour are still more obsessed with spin doctors than doctors. Patients should believe their own experiences not Labour's fiddled figures.
"Labour said they would cut numbers waiting by 100,000 in their 1997 pledge card.
"In March 1997 the number of in and out patients waiting in England and Wales was 1,502,000. In June 2001 there are 1,442,000. This is a reduction of 60,000. They have failed to honour their pledge.
Labour's concentration on waiting list numbers has come in for much criticism in recent years in both political and medical circles.
There have been suggestions that some hospitals have been prioritising relatively simple operations because they can reduce their waiting lists more quickly.
However, this has meant some patients with more serious illnesses are being left to wait for their operation.
Both the Conservatives and Lib Dems have called for the emphasis to be changed to waiting times instead of numbers on lists.
Labour has pledged to reduce out-patient waiting times to three months, and waiting times for surgery to six months by the end of 2005, as part of its NHS modernisation programme announced last year.