The report threatens to undermine ministers' vision of putting libraries at the heart of their attempt to boost lifelong learning and using them as centres where disadvantaged groups can access the Internet and distance-learning.
Open to All? The Public Library and Social Exclusion, reports on a study carried out by academics at Leeds Metropolitan university for Resource: The Council for Museums, Archives and Libraries.
It says that, while libraries have the reputation for reaching out to disadvantaged groups, in reality they have "adopted only weak voluntary and 'take it or leave it' approaches to social inclusion".
"The core rationale of the public library ... essentially reflects mainstream middle-class, white and English values," the report says. To tackle social exclusion, libraries will need undergo "rapid transfromation".
Two thirds of public library authorities, which are run by councils, fail to target disadvantaged groups adequately. And only one in six get close to "a comprehensive model of good practice for social incluson", the report says.
A survey of all public library authorities in the UK carried out for the report also found that many of the most excluded groups, such as homeless people and travellers, "are not considered a priority" by libraries. "Attempts to target services towards excluded people remain patchy and are often time-limited."
Libraries need to modernise and become more pro-active, and interventionist if they are to be more inclusive, the authors say.
And they need to change their image so that they have more appeal for the excluded groups.
The report calls for the Government to introduce national service standards for libraries that would measure their performance in tackling social exclusion.
It also calls for professional organisations, such as the Library Association, to work to increase the number of librarians who come from disadvantaged groups.
The first meeting of a Library Association task force to tackle the problem will be held next week.
Guy Daines a spokesman for the association said, "Although we acknowledge that there's a lot to be done, we have a strong base to build from. Sixty per cent of the public already use libraries."