A "profoundly negative culture" within the Diocese of Chichester led to two decades of child protection failures, a report has concluded.
The inquiry by the Archbishop of Canterbury's office said "fresh and disturbing" aspects of the way abuse claims were handled keep surfacing.
Lambeth Palace has said it will now oversee clergy appointments and child protection matters in Sussex.
Three local priests have been charged this year with child sex offences.
The report by Archbishop of Canterbury Dr Rowan Williams's office is believed to be the first of its kind in the Church of England for more than a century.
It stated: "It is clear to us that many lives have been blighted.
"Some have sought justice through the courts of law. Clergy have gone to prison for their abuse of children.
"We are clear that those who have sought justice through the courts are but the tip of the iceberg."
The report said the abuse was made worse by the "very slow" way the diocese recognised events and failed to act with "rigour and expedition".
"A whole series of investigations and reports across nearly two decades bears witness to a profoundly unhelpful and negative culture in parts of the diocese that led to its failure to take the action needed," it added.
Responding to the report, Dr Williams said in a statement: "Safeguarding and appointments matters should be conducted under the supervision of this office until uniformly better practice can be assured."
The report also said the diocese had "lost the respect" of many in the public services who safeguard children and vulnerable adults.
East Sussex County Council said the report "accurately identifies the dysfunctional nature" of the response to allegations and the relationships within the dicoese's senior team.
Director of children's services Matt Dunkley said: "We have been deeply frustrated by the slow and sometimes ineffective response to the concerns we have raised, including the length of time taken to produce this report."
Lambeth Palace's interim report followed one by Baroness Butler-Sloss last May which found there had been "a lack of understanding of the seriousness of historic child abuse".
The Church of England appointed her to examine how senior clergy dealt with historical claims of abuse.
It looked at the cases of Roy Cotton and Colin Pritchard, who abused children in the 1970s and 1980s.
'Wickedness and shamefulness'
Pritchard served as the vicar of St Barnabas, Bexhill, until 2007, when he was arrested over sex abuse claims. In 2008 he pleaded guilty to sexually abusing two boys and was jailed for five years.
Cotton was ordained in 1966, despite having a conviction for indecently assaulting a choirboy in the 1950s, and went on to abuse at least 10 boys from Eastbourne.
The latest report said however deep and sincere the apologies were for the abuse, they could not take away from the "wickedness and shamefulness" of what happened.
This year three former Church of England priests in the diocese have been charged with sexual offences against children.
Canon Gordon Rideout, 73, of Wannock, East Sussex, is accused of 38 sexual offences against 18 children and young teenagers.
The retired priest is alleged to have committed the offences between 1962 and 1973 in Crawley, London and Hampshire.
Robert Coles, 71, a retired priest from Eastbourne, faces 29 charges of sexual offences against three boys, allegedly committed from 1978 to 1984 in West Sussex, Cornwall, Devon, Somerset and the Isle of Wight.
And Father Wilkie Denford, 77, of Shoreham, West Sussex, has denied four charges of indecently assaulting a boy aged under 16 in the late 1980s.
A special helpline has been set up in conjunction with the NSPCC on 0800 389 5344.