The party began the election as a minority administration with 22 seats but finished on 26 after winning Kentwood, Church and Caversham from the Conservatives and snatching Redlands and Katesgrove from the Liberal Democrats.
They also held Minster, Norcot, Southcote, Whitley, Battle and Abbey but lost Park to the Green Party, who were delighted to add a third councillor to their ranks - all of whom represent the east Reading ward.
Council leader Cllr Jo Lovelock said: "After years of having a hung council, it's great that we have overall control and we've got a programme to put through. What's most important is we continue engaging with the public so decisions are based on feedback from them and that is the central plank in running the council."
The Tories managed to hold Thames, Mapledurham and Peppard, where Jane Stanford-Beale beat Jamie Chowdhary - who dramatically quit the party and announced he was standing as independent just weeks before the election after being de-selected from the seat last year - by 301 votes. It leaves the party with 12 seats.
The Lib Dems had three seats to defend but only held Tilehurst, where long-standing councillor Peter Beard stood down and was replaced by Meri O'Connell. The result leaves them with four councillors and follows a poor performance at last year's election, when the party failed to defend any of the three seats they were defending.
The Conservatives and Liberal Democrats blamed their defeats on a public backlash against the Coalition Government but neither group leader condemned what their parties are doing nationally.
They also pointed to the low turnouts, which ranged from 20.2% in Abbey to 41.37% in Mapledurham, with the average across the 16 wards standing at 29.78%.
Lib Dem group leader Daisy Benson said: "It's not extremely unexpected but I'm obviously disappointed not to be able to hold the two against Labour. I'm delighted we held Tilehurst, I think it shows that people do notice the local effort that we do put in. I think the turnout shows the majority of people are not convinced by any party.
"It is similar to last year. There is massive unease about some of the decision that are going on nationally but being out in Reading, I don't think it was a reflection of what we do locally."
Tory group leader Cllr Tim Harris said: "It was a disappointment, it was worse than I was expecting if I'm brutally honest. My opinion is that it was the national picture but I think the Government are doing exactly the right thing. Unfortunately it will be a full term, four years, until we see the results. At that point the economy will be picking up."
A delighted Green Party group leader, Cllr Rob White, said: "We have been working hard, increasing in Reading and we have had a really positive reception of the doorstep."