"Cluster munitions are imprecise weapons designed to strike a large surface area," Angelo Simonazzi, the group's director general, said in a report released on Thursday at the UN's European headquarters in Geneva.
"They scatter small, highly lethal sub-munitions, creating a 'footprint' within which they indiscriminately kill and injure military targets and civilians."
The study said 98 per cent of the victims of cluster bombs were civilians, and the weapons had killed some 3,800 people and injured 5,500 more in 24 countries.
Unofficial estimates put the real number of victims at 100,000, the Brussels-based group said.
Handicap International is calling for a moratorium on their use and for the weapon to be banned under the UN's 1980 Convention on Conventional Weapons.
Boys at risk
But there is little hope of convincing countries such as the US and Russia to support a ban, Simonazzi told The Associated Press.
"These countries still think they need them for defence purposes," he said. "There are so many in stock that they are simple weapons to use."
In September, a move by Democrats in the United States to stop the Pentagon from using cluster bombs near civilian targets was defeated in the Senate.
Israel dropped four million cluster
bomblets on Lebanon in the war
Cluster bomblets - or sub-munitions - are packed into artillery shells or bombs dropped from aircraft.
Some 200 to 600 of the bomblets are typically scattered over an area the size of a football field from a single cluster-bomb canister fired to destroy airfields or tanks and soldiers.
Usually 10 to 15 per cent - in some cases up to 80 per cent - of the bomblets fail to explode immediately.
Those that do not explode right away can be detonated later by the slightest disturbance, experts say.
With an estimated 33 million sub-munitions lying in current or former war zones, and a further four billion stockpiled by armed forces around the world, the report said the potential for further harm from this type of weapon was significant.
Boys under 18 are particularly at risk, accounting for around 95 per cent of child casualties and about one-third of the overall number the bomblets have killed or injured, according to the report. This is because boys in many countries are responsible for herding animals and collecting wood or water, during which they are exposed to unexploded bomblets lying on open land.
Cluster bombs have killed or injured at least 2,060 people in Iraq, where up to 1.8 million sub-munitions have been dropped by US-led coalition forces, Handicap International said.
It also cited the growing risk from militant groups independent of governments, highlighting Hezbollah's use of Chinese-made cluster bombs against targets in northern Israel.
Israel dropped an estimated four million sub-munitions on Lebanon during fighting in July and August, and an average of two people are still being killed or injured in the country every day, Kathleen Maes, the group's victim assistance coordinator, told reporters.