Primary schools reached their highest ever Sats results this year and were promptly told they must do better.
The interim key stage 2 results show that 81 per cent of pupils reached the expected level 4 in English and 80 per cent did so in maths - one percentage point up on 2010 in both cases.
But the results also unveiled a dramatic slump in the proportion of pupils achieving the higher level 5 in reading, down from 50 per cent in 2010 to 42 per cent this year.
Unions and education experts warned that the fall could be down to schools putting resources into helping more children achieve level 4, at the expense of helping higher-performing pupils.
Schools are deemed failing if they do not get 60 per cent of pupils to level 4 in both English and maths or a higher proportion of pupils than average making two levels progress.
Adrian Prandle, education policy adviser at the ATL union, said: "It does look like there is a focus on the borderline and getting people into level 4. It is an effect of getting people to focus on that level that time and effort has been diverted from elsewhere."
Darren Northcott, national official for education at the NASUWT, called for the level 5 slump to be investigated. "The level 4 borderline is still used as a measure for floor targets - that is where the real hard accountability still is," he said.
Anastasia de Waal, deputy director of think-tank Civitas, said that despite becoming "discredited", Sats still put undue pressure on schools to change the way they teach.
"This year the results have gone up, but the focus is on the kids who haven't reached the level," she said. "This just perpetuates the feeling in schools that you have to sacrifice individual children who have higher or lower abilities because you must focus on those attainment targets."
The marks needed to gain level 5 in reading this year were also the highest set since 2003, with pupils having to score 34 out of 50 compared with 31 last year. The threshold is adjusted each year in an attempt to maintain standards.
A spokeswoman for Ofqual said it would look into the threshold as part of its routine monitoring of the tests and report later this year.
Schools minister Nick Gibb welcomed the fact that more children were doing well, but said the fall in the number of children achieving level 5 was a concern.
"A third of children are still struggling in the three Rs," he said. "There has been a decline in the proportion of children - both boys and girls - who can read and write beyond the expected level. And the results of our weakest readers and writers also remain a real concern."
An inquiry into the assessment system by Lord Bew has led to the Government proposing that writing will be assessed as a mixture of teacher assessment and testing of basic skills from 2013. The reading and maths tests are to remain.
Original headline: Dramatic fall in level 5 reading mars new Sats high