The White House Commission on Complementary and Alternative Medicine Policy (WHCCAMP), established by former President Clinton, said most alternative treatments "have not yet been scientifically studied and found to be safe and effective."
"The commission believes that conventional and CAM systems of health and healing should be held to the same rigorous standards of good science," the panel said in its final report, issued on Monday.
"Therefore, substantially more funding for research is needed to determine the possible benefits and limitations" of various treatments, the report said.
Complementary and alternative medicine is hard to define, the commission noted, but its report included mentions of dietary supplements, chiropractors, acupuncture, massage, biofeedback and yoga.
The use of alternative treatments has risen steadily during the past 30 years, the commission said, with one estimate saying as much as 43 per cent of the US population had tried some type of alternative therapy.
The 20-member White House commission is chaired by Dr James Gordon, a psychiatrist who heads the Washington-based Center for Mind-Body Medicine.
Two commissioners wrote a separate statement criticising the report, saying its recommendations "do not appropriately acknowledge the limitations of unproven and unvalidated CAM interventions or adequately address the minimisation of risk".
While supporting many of the panel's recommendations, Dr Joseph Fins and Dr Tieraona Low Dog said they hoped their critique would "give voice to the healthy scepticism" that many Americans have toward alternative treatments.
In addition to advocating more research funding, the report urged the government to help develop and circulate accurate information about alternative therapies. The commission also called for more training and regulation of alternative medicine practitioners and urged health insurance companies to offer coverage for proven treatments.