Only 12% of adults could answer all four questions about the Christmas story correctly.
Theos said the findings showed the Christmas story was still “very much” in the “cultural bloodstream” of the nation.
Paul Woolley, director of Theos, said: “The fact that younger people are the least knowledgeable about the Christmas story may reflect a decline in the telling of Bible stories in schools and the popularity of nativity plays.
“No one seriously thinks that being a Christian or a member of the established church is the same thing as being British today.”
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