Shadow home secretary Ed Balls has indicated Labour was ready to support moves to cut the pre-charge detention period for terror suspects to 14 days.
Paving the way for a cross-party agreement on reducing the current 28-day limit, he said he would back the change if it would not impede the police and the security services.
His comments mark a significant policy shift for Labour and a break from the Tony Blair and Gordon Brown governments which introduced 28 days and tried to extend the pre-charge period still further.
In an interview with The Sunday Telegraph, Mr Balls admitted Labour had been damaged by its attempts in office to increase the limit to 90 days and then 42 days.
"Even 42 days was a step too far. Our reputation as a party which protected liberty as well as security suffered as a result," he said. "Our approach should always be that, if the evidence shows we can go down from 28 days without impeding the police and security services from doing their jobs, then we ought to do it."
Home Secretary Theresa May announced a review of counter-terror legislation in July, when she said her personal view was that the limit should be 14 days, which the Liberal Democrats also support.
The review, overseen by former director of public prosecutions and Lib Dem peer Lord Macdonald of River Glaven, is ongoing. It is also considering the issue of control orders, which Mr Balls is also prepared to see scrapped if there is a workable alternative.
On both control orders and pre-charge detention, Mr Balls' final stance will depend on the evidence of the police and the security services to the Government's review. But he made clear his intention to move away from what was widely criticised as an authoritarian approach under Mr Blair and Mr Brown.
"I'm quite clear we must always strike a balance between protecting our country from the risks of terrorist attacks on the one hand, and preserving our democratic freedoms and fundamental liberties on the other; it should never be a case of one or the other," he said.
"In government, I've no doubt that my Labour colleagues did their best on every occasion to get that balance right in the face of the real and dangerous threats against the country, but did we always succeed? Probably not."