Russia was also condemned for its human rights record, with its government accused of corruption, harassment of the media, electoral abuse and accusations that its security forces were involved in killings and torture.
The report said China had tightened media controls and access to the internet and also place restrictions on religious freedoms in Tibet and its Muslim Xinjiang province in 2007.
However the state department pointed to some progress, such as the reintroduction of high court reviews of death penalty cases and a temporary relaxation of restrictions on foreign journalists for the 2008 Olympics.
Meanwhile in the case of Russia the US condemned what it called growing authoritarianism through corruption, complicity and centralisation of power in the country's presidency.
It also said restrictions on aid groups and the media in Russia "continued to erode the government's accountability to its citizens".
|Sudan was criticised for continuing abuses|
in the Darfur region [AP]
Sudan's human rights record remained "horrific" the report said, referring to ongoing reports of extrajudicial killings, torture, beatings, and rape by government security forces and rebel fighters in the Darfur region.
It also criticised the Sudanese government for blocking international efforts to deploy a joint African Union-United Nations peacekeeping force, and efforts to supply humanitarian aid.
By the end of 2007 the conflict had left more than two million people internally displaced and another 231,000 had fled across the border to neighbouring Chad, the state department said.
The report also listed 10 countries in which the US said power was concentrated in the hands of "unaccountable rulers [who] remained the world's most systematic human rights violators".
The countries were North Korea, Myanmar, Iran, Syria, Zimbabwe, Cuba, Belarus, Uzbekistan, Eritrea and Sudan.
It also said that human rights had improved in Mauritania, Ghana, Morocco and Haiti since 2006, while little or no progress had been made in Nepal, Georgia Kyrghyzstan, Iraq, Afghanistan or Russia.
The situation had deteriorated in Pakistan, Bangladesh and Sri Lanka, the report added.
In case of US ally Pakistan, the reports said that human rights worsened despite President Pervez Musharrif's repeated pledges to foster democracy.
"Under emergency provisions, Pakistani authorities also arrested approximately 6,000 opposition political party workers, human rights advocates, lawyers and judges," the report said.
The report, which included a separate 60-page section on Pakistan, did recognise Musharrif's decision to stand down as chief of army staff and the lifting of the state of emergency.