The report, released Thursday by the US State Department's Global Engagement Center, accused China of financing propaganda, disinformation and censorship while boosting positive news about the country and its Communist leadership.

A top official from the centre said that if unchecked, this could result in "a slow, steady destruction of democratic values".

Beijing responded by alleging the report itself is "disinformation as it misrepresents facts and truth".

"It is the U.S. that invented the weaponizing of the global information space," a Chinese foreign ministry spokesperson said in a statement published by the official Xinhua news agency.

"Facts have proven time and again that the U.S. is an 'empire of lies' through and through."

The State Department report alleged that China suppresses information that goes against its position on contentious issues such as its human rights record, especially in Xinjiang.

The Chinese foreign ministry spokesperson referenced the "enormous lie made up to smear China's Xinjiang policy".

Beijing has repeatedly rejected accusations that it has incarcerated more than one million Uyghurs and other Muslim minorities in a network of detention facilities in the northwestern region.

"More and more people in the world have already seen through the U.S.'s ugly attempt to perpetuate its supremacy by weaving lies into 'emperor's new clothes' and smearing others," the ministry spokesperson said.