But unlike regulators in the US and France, the Information Commissioner's Office stopped short of fining Google, saying it had found "insufficient evidence" to show that the company had intended to collect the data.
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Google admitted in 2010 that cars taking photographs for its Street View mapping service had gathered private information from unsecured wireless networks, such as email addresses, website addresses and passwords relating to thousands of individuals.
Drawing a conclusion to its probe on Friday, the ICO ordered Google to delete the data within the next 35 days.
Stephen Eckersley, ICO head of enforcement, said: "The early days of Google Street View should be seen as an example of what can go wrong if technology companies fail to understand how their products are using personal information."
Google said it was now proceeding to delete the data in compliance with the ICO's order.
"We work hard to get privacy right at Google," the company said. "But in this case we didn't, which is why we quickly tightened up our systems to address the issue. The project leaders never wanted this data, and didn't use it or even look at it."
The UK watchdog said that while Google's breach of data protection rules was serious, it had not caused enough harm to meet the strict criteria required to issue a fine.
"The punishment for this breach would have been far worse if this payload data had not been contained," said Mr Eckersley.
In March, Google agreed to pay a $7m fine in the US to settle with 38 states where its Street View cars had collected personal data.
The French data protection agency fined the US group ?100,000 in 2011.
Separately, the ICO said it was continuing to investigate whether Google's privacy policy complies with the data protection act. The probe is part of a co-ordinated move by data watchdogs across Europe to assess whether Google's latest privacy policy clearly explains how individuals' personal information is being used across the company's products.
The ICO said it would "shortly" be writing to Google to explain its preliminary findings.
European data protection authorities in Britain, Germany, France, Italy, Spain and the Netherlands this week threatened to fine Google if the Silicon Valley company does not address their privacy concerns within three months.
The co-ordinated move by regulators could result in Google having to pay several million euros, under proposed new rules.
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