The Hampton-Alexander Review latest report found 349 women currently sit on boards at FTSE 100 firms.
The government said the review's "fantastic work" had seen it hit the target almost a year early.
But the review also highlighted a lack of women in senior and executive roles - making up 15% of finance directors.
That compared with women making up 66% of human resource directors, the report said.
The review's chief executive, Denise Wilson, told the BBC that problems such as unconscious bias and gender stereotypes around what a leader should look like were preventing further progress.
"I think 33% is a very good start, but as we can see, we have a lot further to go before we see a good gender balance in the leadership of British business," she said.
Business Secretary Andrea Leadsome said that businesses had achieved the one in three target voluntarily and without the need for legislation or fines but called on firms to do more.
"The Hampton-Alexander Review has done fantastic work but it's clear that women continue to face barriers to success, whether that's through promotion to key roles or how they are treated by colleagues," she added.
The Institute of Directors welcomed the report as evidence that focusing the spotlight on diversity could change the behaviour of big companies. However, it cautioned that it was not a case of job done.
Women on Boards UK chief executive Fiona Hathorn described progress outside the FTSE 350 - a longer list of leading firms - and in UK business as a whole, as glacial.
She called for the lens to move from the board alone to improving representation at the top levels of company management.
Since 2011, two government-backed reviews have focused on boosting women's representation on the boards of UK-listed companies.
Under the Davies Review, which ran from 2011 to 2015, the proportion of women serving on FTSE 100 boards increased from 12% to 25%. The rise in the FTSE 250 was from 9% to 22%, still lagging the 33% target.
Its successor, the Hampton-Alexander Review, encourages FTSE 350 companies to meet a 33% target by the end of 2020. Unlike countries including France which have introduced quotas, it is voluntary.
Until justice is blind to color, until education is unaware of race, until opportunity is unconcerned with the color of men's skins, emancipation will be a proclamation but not a fact.