The UK tolerated "inexcusable" treatment of US detainees after the 9/11 attacks, MPs have found.
The Intelligence and Security Committee (ISC) said it was "beyond doubt" the UK knew the US mistreated detainees.
The UK continued to supply intelligence to allies in 232 cases where British officials knew or suspected mistreatment, its report said.
The ISC found no "smoking gun" indicating a policy of deliberately overlooking mistreatment.
Prime Minister Theresa May said British personnel had been working in "a new and challenging operating environment" which some were "not prepared" for.
She added "it took too long to recognise that guidance and training for staff was inadequate", and said British intelligence and the Army were "much better placed to meet that challenge".
The ISC rejected claims by intelligence agencies that the cases detailed were no more than "isolated incidents".
The report added: "That the US, and others, were mistreating detainees is beyond doubt, as is the fact that the agencies and defence intelligence were aware of this at an early point."
BBC security correspondent Gordon Corera says the report shows there is "no evidence of direct mistreatment" by British intelligence agencies, but there were "13 cases where spies witness first-hand a detainee being mistreated by others".
He added that the ISC criticises the UK's foreign intelligence service MI6, and its listening service GCHQ for playing "a role in enabling some detentions".
The ISC said Ethiopia-born UK resident Binyam Mohamed was held in Pakistan in 2002 - and that MI5 and MI6 were informed by US agents he had been subjected to sleep deprivation.
The report said MI5 failed to act on that information before its own officer arrived to interview Mr Mohamed.
The US then secretly moved Mr Mohamed to Morocco, where he was tortured. MI5 asked its American allies where he had gone and what was happening to him - but was rebuffed.
Despite this, the ISC report says, the agencies gave questions to the US to be put to him. Mr Mohamed was later returned to the UK.
In the report, the ISC says the government "denied" the committee access to "officers who were involved at the time" of the UK's involvement in rendition.
British citizen Moazzam Begg, previously held in Guantanamo Bay, criticised the inquiry's scope as inadequate, saying "we still don't know the process of accountability".
Speaking about his own detention, he said: "British intelligence agents were physically there watching as I was hooded, shackled, with a gun to my head, threatened with being sent to Syria or Egypt if I didn't co-operate.
"There was the sound of a woman screaming in the room next door, that I was led to believe was my wife being tortured. British intelligence agents knew all about this."
Although there is no evidence US rendition flights transited through the UK, there is evidence that two detainees went through the Indian Ocean British territory of Diego Garcia, where records about the conditions in which they were held are "woefully inadequate".
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