The children's services watchdog also said results were better when schools closely monitor the progress of children in care.
Ofsted surveyed 20 schools in local authorities where the children's services had been judged "excellent" to find examples of best practice.
The report, Looked-After Children - Good Practice in Schools, found learning improved when the children were involved in after-school activities and when there was unified but low-profile support in school, so they were not made to feel different from other children.
It also made a difference if there was swift and early intervention if a problem with behaviour or attendance occurred.
However, even though the outcomes of looked-after children in these schools were better than average, they were still "significantly lower" than other children.
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