Meeting the headteachers today at his official residence, Bishopthorpe Palace, Dr John Sentamu challenged Education Secretary Michael Gove's decision to leave RE off the English Baccalaureate.
"Religious knowledge forms and creates a culture," he said.
"Whatever we might think of Michael Gove, in this country, religion and practice will never be on the sidelines.
"It is a surely a mistake, to turn education into a box ticking exercise focused on exam success and the supply of skilled workers to industry and commerce. Education is good for its own sake."
He added: "Trying to side-line Jesus Christ is like trying to disguise the dome of St Paul's Cathedral with a bobble hat. It is not possible."
RE was left out of the English Baccalaureate despite concerns over the subject's future from church leaders and a nationwide petition signed by more than a hundred thousand people calling for its inclusion.
The decision was strongly criticised in a Church of England report last month, which warned of "multiple challenges" to the subject across the school system.
The Church School of the Future report stated that the exclusion of any consideration of the subject from the current revision of the national curriculum was "likely to have a damaging effect on the status of the subject despite the retention of the statutory requirement".
It noted, however, that the Government appeared to have "no will" to address the challenges facing RE.
"While the Church of England has received some encouragement to work together with other
partners to address some of the issues related to religious education, the responses of the
Government to these concerns have been disappointing," it said.
"Realistically, the Church is limited in its ability to influence practice in the classroom even in its own schools. It does, however, have a voice and will continue to press for recognition of the damage being done to religious education."
It adds: "High quality religious education and collective worship should continue to make major contributions to the Church school's Christian ethos."