Too many colleges fail to improve beyond the "satisfactory" inspection level, according to Ofsted.
The watchdog raised its concerns in its annual report on further education, which says more need to be getting "good" or "excellent" grades.
It was particularly concerned that four colleges had been satisfactory for two inspections running.
Sixth-form colleges came out better than general FE colleges, with all those inspected in 2006-07 rated good or outstanding. The report also recognised that success rates have risen for short and long courses and there is improvement across all types of college. Inadequate leadership and management was found in 4 per cent of cases, down from 11 per cent previously.
Inspectors were impressed by colleges' work in meeting the needs outlined in the recent Leitch review of skills - by meeting the needs of employers. The report said: "The evidence of inspection in 2006-07 indicates colleges are rising to the challenges identified by the Leitch review and are focusing increasingly on improving their responsiveness to employer demands."
Satisfaction fatigue, page 4.