Featuring only parties loyal to President Islam Karimov, the Organisation for Security and Cooperation in Europe (OSCE) said on Monday there had been little improvement since similarly unfair elections in 1999.
The head of the OSCE mission, Lubomir Kopaj, added that: "The election legislation by the authorities failed to ensure a pluralistic, competitive and transparent election."
The OSCE concluded: "The similarity of the political platforms of the registered political parties appeared to deprive voters of a genuine choice."
Four opposition parties were barred from participating in the Sunday vote after the justice ministry refused to register them.
But Karimov, who has ruled the nation of 26 million since Soviet times, hailed the vote as a step towards democracy, pointing to five loyal parties on the ballot as a sign of a viable multi-party system.
Uzbek officials had earlier said the election was "open and honest, held in conformity with the law", while observers from the post-Soviet Commonwealth of Independent States lauded the "transparency and democratic manner" of the vote.
Uzbekistan is an ally in Washington's War on Terror, but has come in for strong Western criticism for its clampdown on dissents, and the widespread use of torture on thousands of political and religious prisoners.
Karimov, who enjoys almost unlimited powers and extended his presidency until December 2007 in a controversial referendum, said on Sunday Uzbekistan had no room for a weak or "artificially created" opposition.
He also said he would not tolerate "orange or rose revolutions" with street protests such as those in Ukraine and Georgia, where pro-Western liberals won the presidency.