Overcrowding in Birmingham hospitals has been blamed for the spread of the MRSA superbug, after the Department of Health admitted wards were full.
Official figures showed a number of Midland hospitals were operating above capacity.
The Government target is for only 85 per cent of beds to be occupied at any time - allowing empty beds and cubicles to be thoroughly cleaned.
But many Midland hospitals are operating at occupancy levels of 90 per cent or more.
The result is that infections are passed between patients, opposition MPs warned.
Steve Webb, health spokesman for the Liberal Democrats, said: "In some hospitals a bed hardly has time to go cold before the next person occupies it, making effective infection control all the more difficult."
In Birmingham, Heartlands Hospital had an occupancy rate of 90 per cent in 2004-5, while Birmingham's Children's Hospital had an occupancy rate of 95 per cent.
Good Hope Hospital had an occupancy rate of 89 per cent; City Hospital had an occupancy rate of 86 per cent, and Queen Elizabeth Hospital had an occupancy rate of 92 per cent.
Hospitals in other parts of the Midlands also suffered from overcrowding.
Worcestershire acute hospitals NHS Trust, which runs the Worcestershire Royal Hospital in Worcester and Alexandra Hospital in Redditch, Worcestershire, reported an occupancy level of 95 per cent.
The Shrewsbury and Telford Hospital NHS Trust, responsible for the Royal Shrewsbury Hospital and the Princess Royal Hospital in Telford, both in Shropshire, also had an occupancy rate of 95 per cent.
It follows a dramatic increase in cases of so-called "bed blocking," which occurs when patients are stuck in a hospital bed not because they need treatment, but because they have nowhere else to go.
Earlier this year it was revealed the problem had risen 50 per cent in 12 months due to a shortage of places in care homes, and almost one in ten patients could be discharged if care was available outside hospital.
There has also been a dramatic rise in MRSA cases across the region.
Birmingham's Queen Elizabeth Hospital recorded the highest infection rate in the country, while City Hospital and Good Hope Hospital all reported increased infection rates when official figures were published in June.
The Health Protection Agency has warned there is a direct link between high bed occupancy and hospital acquired infections.
Mr Webb said: "The Government makes much of its measures to fight hospital superbugs, but some of its own policies are making matter worse.
"The Government should realise that driving up bed occupancy rates is damaging the fight against infection, and it should enable hospitals to run at more sustainable levels of activity.
"Budget pressures mean that trusts are currently cutting hospital beds, yet what is needed is more bed capacity in order to tackle superbugs."
The Department of Health has written to 20 Midland Health Trusts warning they are heading for significant budget deficits - and must save money.
A Department of Health spokesperson said: "Many hospitals meet access targets and keep infection rates down. The NHS runs at high bed occupancy rate because it is treating more patients and cutting waiting lists.
"Increased activity means we have to work even harder to reduce the risk of infection, and this is what the NHS is doing."