The percentage of households with at least one person out of work has fallen to its lowest level since records began in 1996.
So-called workless households stood at 17.1% in the three months to June, down from 17.9% a year ago and 19.2% in the same period in 2010.
The number of people aged between 16 and 64 in workless households has fallen to 4.9 million, the first time it has been below five million since 2008, according to the Office for National Statistics.
Other data showed that the number of children in workless households is 1.6 million, with two-thirds living in single-parent families.
The number of households where no one has ever worked stands at 297,000, down by 43,000 over the past year.
The North East remains the area with the highest percentage of its households workless, at 23%, with the South East having the lowest - 13%.
Employment Minister Mark Hoban said: "Helping people off benefits and into work is one of this Government's top priorities, so it's good news that the number of workless households has fallen by more than 425,000 since the Coalition took office.
"By reforming the welfare system to ensure that people are better off in work than on benefits, and through schemes such as the Work Programme and Youth Contract, we are giving people the support they need to get a job and fulfil their aspirations of looking after themselves and their families."
Lily Caprani, policy director of The Children's Society, said: "A significant drop in the number of children living in workless households is good news, but, as we know from our work up and down the country, it is deeply concerning that for far too many families a move into work is sadly not a move out of poverty.
"Two-thirds of children now living in poverty are in working families - a quarter of a million more compared to 15 years ago. The Government clearly must do much more to support low-income working families. This includes making sure that they do not miss out on extra vital help such as child care and that they are entitled to free school meals."