Nick Clegg compared the press to "desperate" animals as he said the Government should fully accept the recommendations of the Leveson Inquiry into press standards as long as they were "proportionate".
The Deputy Prime Minister said the test for the new regulatory regime was whether it would meet the concerns of victims of phone hacking.
He questioned whether it would be possible to have an independent regulator without some form of statutory framework but insisted there was no question of state interference in the press.
Nick Clegg speaking at his party conference in Brighton
Answering questions from activists at the Liberal Democrat conference in Brighton, Mr Clegg said if Lord Justice Leveson's report produced proposals that are "proportionate and workable" then "we should implement them, simple as that".
He said he agreed with David Cameron that the success of the proposals would be judged on whether they showed the victims that lessons had been learned.
The test, Mr Clegg said, was "can we look Milly Dowler's mother and father in the eye, whose privacy was so outrageously abused?"
But he said it would be "completely unacceptable to do anything that allows politicians and government to intrude on the content of what the media do".
Mr Clegg said: "I would never accept illiberal statutory regulation of the press.
"We are a liberal party, we believe in free speech. Even I believe in the freedom of the Daily Mail to say the things they say about me and us every day.
"I think people are creating this spectre of statutory interference, it's just not going to happen."
But, he said there needed to be an independent regulator and "the question is can you have something which is genuinely independent of the press, so it can be tough on the press when that is merited, which doesn't in one shape or form, even indirectly have some kind of footing in statute".
Mr Clegg blamed declining circulation figures for the behaviour of the press.
He said: "The written press is an industry, it's a bit like animals around a disappearing waterhole. They are fighting over an increasingly small pool of customers.
"What's happening in the British press, because they are becoming more desperate, because people are accessing their information in increasingly different ways, I really doubt that my children ... when they get older they are going to buy a newspaper in the traditional sense.
"So of course what you have got, which is almost inevitable, you are getting an increasingly shrill, ferocious tone, at times almost hysterical tone, as newspapers worried about their own futures try and keep their heads above water."
But he added: "Much though, of course, it's sometimes extraordinary to see the level of downright exaggeration, hyperbole or mendacity, it's not really for liberals to start saying we are going to start wielding a great big club over them.
"That is one of the prices of a free society and I'd rather have a free society with a raucous and rude press than an unfree society with a timid and insipid press."
The Guardian reported that his words were welcomed by the Hacked Off campaign which, along with the comedian Steve Coogan, is due to meet Clegg on Tuesday.