An inquest heard how the Government ban on smoking in NHS buildings forced the habit "underground", with patients using toilets and shower areas for a "crafty smoke".
Victor Wheelhouse, 64, suffered horrific burns after it is thought he accidentally set fire to his pyjamas as he smoked in a toilet at the Becklin Centre in February 2007.
Following the death Leeds Mental Health Trust and the company which built the centre, Accent, were issued enforcement notices ordering them to improve safety.
But a coroner yesterday refused to criticise the trust after hearing how they had taken steps to prevent further tragedy, including a ban on all patients carrying lighters.
Medical director David Newby also told the hearing funding had been made available to improve staffing levels to police the no smoking policy.
Mr Wheelhouse, of Willow Approach, Burley, Leeds, had been admitted to the centre with depression brought on by Huntington's Disease, a neurological illness. Leeds Coroner's Court heard how the retired warehouse worker had been fit and active for much of his life until being diagnosed with the condition.
When first admitted to the Becklin Centre there was a designated smoking room until it closed on January 1 last year in line with Government policy. He was then given a swipe card which allowed him to go outside to smoke. But it was taken from him after he was found wandering the streets.
Staff would occasionally be available to escorting him outside the building while he had a cigarette but were usually tied up with more important duties. Mr Wheelhouse, along with other patients, then resorted to smoking to inside the toilets, which were not fitted with smoke detectors.
On the day of the incident staff at the centre sprayed Mr Wheelhouse with a fire extinguisher and used a duvet to smother the flames after hearing his cries for help.
He was taken to St James' s Hospital but he died of his injuries after suffering 46 per cent burns to his upper body.
Recording a verdict of accidental death, West Yorkshire Coroner David Hinchliff said he didn't believe Mr Wheelhouse had intended to take his own life.
He said he was satisfied with the procedures which had since been put in place and would not be making any recommendations to the trust.