More than 400 pubs, cafes and other indoor venues in the West Midlands have been caught breaking the smoking ban since it was introduced last year.
New figures from the Department of Health revealed that inspectors working for local councils found 430 premises where managers knowingly allow customers to smoke.
But this is less than two per cent of all the premises inspected since the ban came in 12 months ago.
Officials in the region also found 63 vehicles such as taxis, buses and coaches where smoking took place.
In the same period, only two West Midlands business were prosecuted for allowing smoking on their premises or in vehicles – where they faced fines of up to £2,500. Councils in the region also issued 255 written warnings.
The Government has encouraged councils to use prosecution only as a last resort. Instead, authorities were encouraged to work with local businesses and try to educate them about the new legislation.
Health Minister Dawn Primarolo hailed the ban as a success, as she spoke at a conference of medical professionals at the Hilton Metropole, near the NEC in Solihull.
She said more people were trying to quit smoking, the air in pubs and bars was cleaner and most people had obeyed the new law.
The Minister published a report which showed 400,000 smokers across the country had quit in the past 12 months and nearly two-thirds of landlords now support the ban,.
Professor Robert West, Cancer Research UK’s director of tobacco studies, said: “These figures show the largest fall in the number of smokers on record.
“The effect has been as large in all social groups, poor as well as rich smokers.
“I never expected such a dramatic impact and of course there are no guarantees that smoking rates will not climb back up again.
“But if the Department of Health can keep up the momentum this has created, there is a realistic prospect of achieving a target of less than 15 per cent of the population smoking within the next 10 years.”
A separate survey by anti-smoking pressure group Action on Smoking and Health (Ash) found 63 per cent of people strongly supported the ban.
And a majority wanted restrictions to go further – with 59 per cent supporting a ban on tobacco being on display in shops and 65 per cent wanting sales from vending machines to be prohibited.
Despite the hit on pub profits, a survey by The Publican also revealed that landlords are happy with the legislation.
Of the 1,500 licensees questioned, 64 per cent said they supported the ban – up from 55 per cent when it was first introduced.
Ms Primarolo said: “We introduced this law one year ago to cut people’s exposure to secondhand smoke. It’s clear the law is working. Bar workers are inhaling far less smoke and most people think the law has had a positive effect on the country’s health.
“This could not have been done without the tireless work and support of local authorities, business and health campaigners. I also commend smokers themselves for their willingness to protect the health of others by so readily complying with the law”.
Sir Liam Donaldson, the Chief Medical Office, said: “A year ago today in England, we took one of the most important steps forward in public health for many years. One year on and the smokefree law has been accepted by the general public and businesses alike.”