People convicted of knife-carrying offences are now less likely to go to jail, Ministry of Justice figures show.
Statistics for the first three months of this year show 19% of knife possession offences led to prison terms - the lowest figure for two years.
Police and courts in England and Wales dealt with 5,300 people accused of knife possession - a 22% drop compared with the same period in 2009.
This fall was more marked for young offenders, down to 1,000 from 1,400.
During the same period, 1,000 of all possession offences resulted in immediate custody compared with 1,500 in 2009.
Among 10- to 17-year-olds, 6% of offences resulted in a jail term.
Jail terms are longer than before - the average length of a custodial sentence was 219 days, compared with 180 days last year.
A Ministry of Justice spokesman said penalties for knife-related offences would be examined as part of a full review of sentencing policy.
"We need to send a strong message to those who carry knives," he said.
"People who commit knife crimes should expect tough sentences, including prison when necessary."
Tougher sentences were introduced for offences involving the possession of a knife in 2008.
Senior judges said magistrates should look to their toughest powers when dealing with knife carriers.
Adults caught holding a knife were told to expect a three-month prison sentence, although a guilty plea and other mitigation could lead to a lesser punishment.