Interior minister Nur al-Din Zarhuni told government newspaper al-Mudjahid on Sunday that "the state of emergency has not reduced individual or political liberties".
He said: "Its principal role is to coordinate the different forces involved in fighting terrorism ...
"Those calling for the lifting of the state of emergency do so either out of ignorance as to why it's needed, or they want to dismantle security measures ... or for purely electoral purposes."
Algeria has rejected mounting calls from opposition parties, the US administration and human rights groups to scrap the law which they say restricts political activities.
The international pressure has been particularly vocal in the run-up to presidential elections on 8 April.
Under the state of emergency, public demonstrations are banned and local authorities can order an end to all activities affecting public services.
Among other powers, the decree gives the interior minister the power to close meeting places and authorise security forces to search houses day or night.
The North African country declared a state of emergency in February 1992, shortly after the military cancelled legislative elections the Islamic Salvation Front (FIS) was set to win.
"It's (the state of emergency) principal role is to coordinate the different forces involved in fighting terrorism... Those calling for the lifting of the state of emergency do so either out of ignorance as to why it's needed, or they want to dismantle security measures... or for purely electoral purposes"
Nur al-Din Zarhuni,
Algerian interior minister
A civil war followed the dissolution of the FIS party and has since led to the deaths of more than 150,000 people, according to rights groups. Authorities put the number of deaths at 100,000.
Lorne Craner, US Assistant Secretary of State for Democracy, Human Rights and Labour, last month questioned the need to keep the law in force now that violence has fallen sharply.
However, human rights group Amnesty International said in a recent report the level of violence in Algeria remains high.
The organisation's 2003 report on the country said hundreds of civilians, including children, were killed in attacks by armed groups.
And hundreds of members of the security forces, state-armed militias and armed groups were killed in attacks, ambushes and armed confrontations.
The report added torture by security forces continued to be widespread, particularly during secret and unacknowledged detention.
Moreover, Amnesty said human rights defenders were harassed and intimidated by the authorities and there was overwhelming impunity for rights violations.