Home Secretary Theresa May has unveiled a reform of the UK's asylum rules during an uncompromising speech to the Conservative Party conference.
Mrs May pledged to reduce the numbers claiming in Britain while taking in the "most vulnerable" refugees from conflict zones around the world.
She also said high migration made a "cohesive society" impossible.
Her speech was criticised by business groups, with the Institute of Directors attacking its "irresponsible rhetoric".
Net migration into the UK currently stands at a record high, reaching 330,000 in the year to March.
The home secretary told the Conservative Party conference Britain "does not need" net migration at current levels, saying the net economic effect was "close to zero" at best.
In other developments:
- Boris Johnson - seen as a potential Conservative leadership rival to Mrs May - said welfare reforms must protect low-paid workers
- Work and Pensions Secretary Iain Duncan Smith said the mission of his welfare reforms was to "restore people's lives"
- Education Secretary Nicky Morgan and Health Secretary Jeremy Hunt also addressed delegates
- Prime Minister David Cameron said Mr Hunt's earlier comments on tax credits had been "misinterpreted"
- The UK's ban on prisoners' rights to vote looks set to continue after a European ruling
- Parents in England who refuse to pay a penalty after their children play truant will have their child benefit docked
- Live updates from the Conservative conference
BBC assistant political editor Norman Smith said Mrs May's comments on immigration were "extraordinarily tough" and "utterly uncompromising".
Beforehand, Prime Minister David Cameron had said he agreed with what she was to say.
Addressing the party conference in Manchester, she said the main way of claiming asylum - by people already in the country - had failed, and rewarded "wealthiest, the luckiest and the strongest".
The UK would not adopt a common EU policy "in a thousand years" she said, promising a "new British approach", including tougher treatment for people who have travelled to the UK from other safe countries.
People who have "spurned the chance to seek protection elsewhere" will not have an automatic right to stay in the UK, she said.
Instead, priority will be given to "helping the most vulnerable people in the world's most dangerous places", she pledged.
The first ever "annual asylum strategy" will be published next year, along with a register of people and organisations able to accommodate refugees.
The overhaul also includes a new system of "safe return reviews" so asylum seekers can be returned home when their country is assessed as being safe, and the use of alternative ID documents to remove failed asylum seekers who do not have their own passports.
Mrs May also said refugees should not be "conflated" with economic migrants.
The "desire for a better life is perfectly understandable" she said, but "there is a limit to the amount of immigration any country can and should take".
Controls are needed, she said: "Because when immigration is too high, when the pace of change is too fast, it's impossible to build a cohesive society. It's difficult for schools and hospitals and core infrastructure like housing and transport to cope."
Wages are also forced down and some people "forced out of work altogether", she added: "But even if we could manage all the consequences of mass immigration, Britain does not need net migration in the hundreds of thousands every year."
Mrs May said immigrants could fill skills gaps, but said "not every person coming to Britain right now is a skilled electrician, engineer or doctor".
She said evidence showed that "at best the net economic and fiscal effect of high immigration is close to zero" and that there was "no case, in the national interest, for immigration of the scale we have experienced over the last decade".
The home secretary hit back at critics of her planned crackdown on student visas, saying "too many" students were not returning when their visas run out.
"So I don't care what the university lobbyists say: the rules must be enforced.
"Students, yes. Over-stayers, no. And the universities must make this happen."
Analysis by Dominic Casciani
Institute of Directors director general Simon Walker said he was "astonished" by the home secretary's "irresponsible rhetoric and pandering to anti-immigration sentiment".
"It is yet another example of the home secretary turning away the world's best and brightest, putting internal party politics ahead of the country, and helping our competitor economies instead of our own," he said, adding that "the myth of the job-stealing-immigrant is nonsense".
Speaking on BBC Radio 4's The World at One, John Cridland, of the CBI, said the government was ending up penalising skilled workers who "add hugely to the collective economic strength of the economy".
Refugee Council chief executive Maurice Wren said the asylum changes were "thoroughly chilling".
"Becoming a refugee is not solely the privilege of the poor or infirm," he said.
Amnesty International said the proposals would make it "harder and harder for desperate people to claim the protection they need".
Labour's shadow home secretary Andy Burnham said Mrs May's speech was "misleading and narrow-minded", while UKIP accused the Conservatives of "meaningless targets and use PR bluster".
But Lord Green, chairman of the Migration Watch think tank, said it was a "thoroughly courageous speech".
He added: "These issues are now the public's greatest concern and she was speaking frankly and decisively on their behalf."
Ministers have admitted missing their target to reduce net migration below 100,000, blaming the scale of migration from within Europe.
Speaking on BBC Radio 4's Today programme, Mr Cameron said he agreed with Mrs May's comments on the subject, saying integrating new arrivals was "more difficult if you have excessive levels of migration".
The PM also said he was "incredibly proud" the UK had built one of the "most successful multi-racial, multi-ethnic democracies anywhere in the world".
But he said that for an "integrated, successful society you have to make sure there are enough school places and that hospitals aren't overcrowded".
According to the latest figures released in August, net migration of EU citizens was 183,000, up 53,000 from the year ending March 2014.
The number of those arriving from countries outside the EU was still larger, with net migration measured at 196,000, up 39,000 on a year earlier.