Ofsted's controversial chief inspector made a U-turn on one of his key policies on Tuesday.
Sir Michael Wilshaw has backed down on contentious plans to give schools no notice ahead of inspections, saying they will instead be notified the afternoon before.
But proposals to scrap the "satisfactory" grade were given the go-ahead and are likely to upset headteachers' unions as it is likely to leave more schools in special measures.
At present a school can be judged as outstanding, good, satisfactory or inadequate but from September "satisfactory" will be replaced with "requires improvement" in order to tackle the number of schools that have maintained a satisfactory rating over a number of inspections without improving.
It will mean Ofsted will reinspect those found to require improvement sooner than under current inspection arrangements.
While better-performing schools will be reinspected within two years, further education and skills providers found to require improvement will be reinspected within 12 to 18 months.
Sir Michael confirmed that if a school has been judged to require improvement at two consecutive inspections and is still not providing a good education at the third, Ofsted is likely to find the school to be inadequate at that inspection and be placed in special measures.
Sir Michael prompted outcry from school leaders when he originally suggested the move, soon after taking up his post as chief inspector in January.
They said it would only increase the stress on schools and have a negative effect on the workforce and pupils.
Announcing the results of the 12-week consultation, A good education for all, which was launched by Sir Michael in February, he said: "All schools and colleges can, and should, provide at least a good level of education.
"Parents and employers, children and learners, expect nothing less. That is why we are introducing these changes to the way we inspect.
"Inspectors will be clear about what needs to improve, and will return sooner to those that are not yet good to check their progress.
"We want to work with good headteachers and principals as they strive to provide the best education possible for pupils and learners. These new arrangements have benefited from extensive consultation and I am grateful to all those who took the time to respond."
The report said inspectors will continue to focus on the quality of teaching but from September, only schools and further education providers with outstanding teaching will be awarded Ofsted's "outstanding" grade.
Ofsted said although it had proposed conducting school inspections without any notice, it had decided to make it the day before due to headteachers' concerns raised during the consultation.
All the changes are expected to come into force from September 1.
Sir Michael, who previously had a successful career as a headteacher, including serving as executive head at Mossbourne Academy in Hackney, east London, has not proven popular since his appointment.
Earlier this month delegates at the National Association of Head Teachers (NAHT) annual conference in Harrogate accused him of "bully-boy tactics" and passed an emergency motion saying they were "saddened and dismayed" by his approach.
He did not help matters when he then launched a stinging attack on heads and teachers who he said make excuses and complain about their jobs when they do not really know what stress is.
He told a conference held at independent school Brighton College: "What we don't need are leaders in our schools whose first recourse is to blame someone else - whether it's Ofsted, the local education authority, the Government or a whole host of other people."
But today's results were welcomed by NAHT, which praised Ofsted for pulling back from plans for no-notice inspections.
NAHT general secretary Russell Hobby said: "School leaders will be relieved to hear that Ofsted has listened to their concerns in several areas and acted on them.
"This signals a move towards establishing a more constructive working relationship between the profession and its inspectorate.
"Ofsted is rightly maintaining a robust position on standards - a position which the NAHT supports - but this move signifies a genuine attempt to work with schools on the best way to achieve those standards. That can only be good news for all concerned, not least for pupils."