Wild horses gathered by helicopter from the Twin Peaks Herd Management Area in California.
"With this in mind, we conducted an inspection of the BLM programme to determine if wild horse and burro gathers are necessary and justified, and if wild horses and burros are being mistreated," the report said.
"We found that BLM lands cannot sustain the growing population of wild horses and burros and that the growing population of these animals must be addressed to achieve and maintain a thriving natural ecological balance of the authorised uses of the land.
"Gathers are an essential means to control the population and are, therefore, necessary and justified actions.
"Further, we noted several actions planned to help resolve the ongoing population control issues. Additionally, we found that BLM and its contractors did not treat any wild horses and burros inhumanely."
However, the report has failed to satisfy the American Wild Horse Preservation Campaign, which labelled it superficial and inadequate.
The report, it said, was further evidence that the Interior Department, of which the Bureau of Land Management is part, is incapable of monitoring or reforming itself.
The office of the Inspector General said it conducted an assessment of the programme "in response to current allegations of mismanagement and abuse surrounding the BLM's wild horse and burro programme".
The report noted that horse gathers were a primary method for managing herd sizes.
"Regardless of which method of capture is used, the risk that horses or burros will be injured or killed is an unavoidable consequence of gathering," the report noted.
"Injuries and broken bones can and do result from the effort to herd, capture, and transport the animals. In addition, gathered horses and burros that are affected by chronic or incurable disease, injury, lameness, or serious physical defect - including severe tooth loss or wear, club feet, and other severe, acquired or congenital abnormalities - are humanely euthanised.
Wild horses grazing the Onaqui Mountains Herd Management Area in Utah.
"We found that fiercely competing interests and highly charged differences of opinion currently exist between BLM and private individuals and organisations concerning the need for wild horse gathers, the methods used to gather, and whether horses are treated humanely by BLM and its contractors during and after the gathers.
"In addition, public interest groups have claimed that the science behind programme management is inaccurate.
"BLM has acknowledged that the science behind its programme needs to be reviewed."
The report continued: "We determined that wild horse and burro gathers are necessary for population control, as the population cannot be sustained by the land.
"We also determined that BLM's gathers are justified and that BLM is doing its best to perform a very difficult job. We did not observe any instances where BLM or its contractors treated wild horses and burros inhumanely.
Wild horses at the Indian Lakes Wild Horse Facility in Fallon, Nevada.
The American Wild Horse Preservation Campaign, in its criticism of the report, said it simply regurgitated the "same rhetoric" the BLM "has been using for years".
The report failed to address viable humane alternatives to the rising costs and casualties and instead supported the push to arbitrary horse population levels.
"The report does not critically examine the fundamental policies which have continued for over 35 years.
"At the very least, we expect investigation into less traumatic gather methods and revised long-term holding concepts.
"Once again, the fundamental issues remain unaddressed, including the lack of scientific rationale for the programme, misallocation of public resources for private commercial interests, including livestock grazing, and the failure of the BLM to implement effective on-the-range management strategies.
"The shortcomings of this report are evidenced by the fact that the Office of the Inspector General, by its own admission, "did not examine the science behind" the justifications for wild horse roundups.
It instead accepted the bureau's claims of wild horse overpopulation and reproduction rates without independent assessment or validation, the group said.
"Clearly this report, with its blatant shortcomings, is timed to convince Congress to continue funding this broken federal programme.
"Congress should not give this biased report credibility and must instead step in to reform this wasteful and inhumane government programme."