The report by the China Health Care Association found 767 out of 2,951 supplements did not have authorisation for their manufacture or used other businesses' production licences, according to the state news agency Xinhua today.
Another 267 supplements were suspected of the same violations and were under investigation, the report said.
The survey, the biggest ever of its kind, was conducted from June 2004 to March 2005 and investigated pharmacies, supermarkets and health food franchised stores in more than 300 cities and counties across the country.
Weight loss products accounted for the biggest portion - 25 per cent - of the 767 fake products, followed by those claiming to improve the immune system and beauty products.
"These fake health products generally falsify or use other businesses' production license number instead of counterfeiting famous brand names," Zhu Kangnian, CHCA's secretary general, told Xinhua.
"They don't have strong promotion team or hardly advertise themselves. So customers can avoid being cheated by choosing well-known brands when buying health supplements," he said.
China is currently drafting new food safety laws that will regulate its supplements market.