The UK is "better off" being part of the EU, Prime Minister David Cameron said.
But Mr Cameron said he wanted to see changes being made to "find a Europe that suits us better".
The Prime Minister is expected to use a major policy speech next week to set out details of a new EU "settlement" he wants to negotiate to repatriate some sovereign powers from Brussels.
Asked about the issue during an appearance on ITV's Daybreak, Mr Cameron said: "I think we're better off in the EU."
But he added: "I'm not happy and the British public isn't happy with every aspect. We're going to use this process of change to find a Europe that suits us better. We're never going to join the single currency."
His comments came as Communities Secretary Eric Pickles became the second Cabinet minister in recent days to raise the prospect of Britain leaving the European Union. Amid deepening divisions in the Conservative Party over the issue, Mr Pickles said the UK should not remain a member "at any price". "If it's in our clear national interest that we should remain in the European Union - and I sincerely hope that is the case - then we should stay, but we shouldn't stay at any price," he told BBC Radio Five Live.
Mr Pickles insisted he was principally concerned about standing up for what is best for Britain, rather than the interests of his party. "It shouldn't be something that becomes a yardstick of some kind of new faith," he said. "It should be really about 'Is it in the national interest?'. Not 'Is it in the interest of the Conservative Party or the Labour Party or Liberal Democrats or trade unions'. Whether it's in the national interest or not."
His intervention echoes that of Chancellor George Osborne, who said last week that the EU "must change" if Britain is to remain a member of the EU.
Mr Cameron is caught in the middle of an increasingly ill-tempered row over the issue as others in his party warn that leaving the EU would be highly damaging.
Cabinet minister Ken Clarke is to share a platform with Labour peer Lord Mandelson later this month to stress the benefits of remaining in the union. The pair are launching a new cross-party organisation, the Centre for British Influence through Europe, to make the "patriotic" case for British engagement. And around 20 Tory MPs have also apparently signed a letter, due to be published this week, warning of "massive damage" if the UK leaves the EU.
