The Department for Culture, Media and Sport would "ideally" have around 100 more staff working on policy, according to its permanent secretary Sue Owen.
DCMS, which has responsibility for a wide range of policy areas including arts and culture, media, sport, and tourism, is one of the smallest departments in Whitehall, with just over 450 staff.
The department has made big reductions to its spending in the last five years, with its day-to-day budget cut by 24% between 2011 and 2015.
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November's government-wide Spending Review meanwhile asked DCMS to make a further 5% cut to its resource budget over the course of the parliament, with core DCMS administrative spending – which includes staff costs – set to fall by just under 7% by 2019-20.
Owen on Tuesday told MPs on the culture, media and sport committee that she had been "absolutely delighted" with the Spending Review settlement, and said that while administrative spending would fall under the deal, DCMS was in a "much, much more fortunate place than I ever expected we would be".
But the DCMS perm sec made clear that DCMS was at "just about" at the minimum levels of staffing it needed to do its job – and said she would boost the department's policy teams if she were given extra funding.
Conservative MP Jesse Norman, who chairs the Commons committee, asked Owen what areas she would prioritise were DCMS to get more cash.
The perm sec replied: "On the administrative side I think we would put some more into the digital side, which is an increasingly important part of our responsibilities.
"But I would probably also want to spread a bit more resource over the direct policy side, on the culture and sport side, where we do have extremely small teams.
"We have done some little calculations like how many members of staff we have per percentage of GDP that we're accountable for and it is very small. The sport team is, I think, 15 people... about 3 [percent of GDP]. Ideally we would have probably about 100 more staff, and I think we'd spread them fairly evenly over the policy function."
According to the government's own analysis, while DCMS accounts for less than 1% of total government spending, it oversees sectors making up around one-sixth of the UK economy.
It is also responsible for delivering the government's pledge to ensure that 95% of UK homes are able to access superfast broadband by the end of next year, and Owen said there were questions about the future size of the department once that programme had been wound down.
"We've done some work on what the kind of minimum size you need to run a department and I think we're just about at that minimum," she told the committee.
"Looking three or four years ahead when the broadband programme has finished, we do need to think about how we keep the department going then, if we don't pick up any more responsibilities. That's certainly a long-term, strategic issue that we discuss with our non-executives and with the departmental board."
"We're very nimble, we're very quick, we get things done very easily"
Owen was joined at the committee hearing by the department's director general Sarah Healey (pictured), who pointed out that DCMS dealt with "marginally fewer" pieces of ministerial correspondence than the Department for Communities and Local Government, despite being "substantially smaller" than that department.
"There is sort of a base level of activity that you need to maintain as a department of state in order to function properly," Healey said.
"We have benefited from the broadband delivery project. And we've benefited from growing responsibilities on digital and we will from cyber security. Obviously, over time, as those programmes wind down, they will stop being able to make a contribution to those kind of core costs and we will have to think really hard about how we deliver in future."
But the director general said there were also "real advantages" in being a relatively tiny Whitehall department.
"We're not bureaucratic, we're very nimble, we're very quick, we get things done very easily," Healey said, adding: "The fact that we can move very quickly to get people from one area and put them somewhere working on something else, when that's a priority, is something that we think is a big advantage."