REFUGEE children will be removed from league-table calculations to encourage headteachers to give places to thousands of youngsters who are not in school.
The Government has announced that performance data will in future not include pupils who are admitted to the final years of primary and secondary school with a poor grasp of English.
The exemption, which applies to children entering school in Years 5, 10 or later, could mean a dramatic improvement for some schools in this year's league tables of national curriculum tests and GCSE results.
Schools minister Jacqui Smith said: "We are responding to schools which believe the current approach penalises them. We want to ensure schools are not discouraged from taking in pupils who arrive from overseas."
It is estimated that about 2,000 asylum-seekers' children are not enrolled in school.
According to the Refugee Council, schools have turned pupils away because of the effects their results can have on rankings.
Of the 100 children in Lambeth not in school, 95 are asylum-seekers and 37 of those have been out of school for more than six months.
In the past few months, five children in Yorkshire and Humberside have struggled to find school places.
Jill Rutter, Refugee Council education co-ordinator, said: "This announcement is very much welcome and will give schoolsand local authorities no excuses."
For Freda Hussein, head of Moat Community College in Leicester, the move could mean a 10 per cent jump in the school's five A* to C GCSEs score.
She said: "This will give us a massive boost, particularly the staff who carry the stigma of a low league-table position."
Monica Galt, head of King's Road primary in Manchester, which has new pupils from Libya and Pakistan, said: "This is excellent news. The Government should now turn its attention to other disadvantaged groups like special needs children."
John Dunford, general secretary of the Secondary Heads Association, described the change as a small step towards a fairer assessment of school performance.
The change will only affect information published on individual schools and local education authorities. National statistics will continue to be compiled on the same basis.
Schools will be asked to provide details of pupils who fit the criteria for exemption at the same time as they are asked to check GCSE and key stage 2 results.
There are an estimated 220,000 to 300,000 asylum-seekers in Britain and about 65,000 are of school age.
The majority are in London and the South-east but, since April, newly-arrived families have been dispersed to other local authorities, mainly Leeds, Liverpool, Manchester and Glasgow.