Just one in 10 gets five Cs or better at GCSE, says a survey by the charity - a separate poll found three quarters of parents expect their children to hit this target.
There are 80,000 children in care in the UK and the survey of 16 to 21-year-olds in care found that many are trapped in a cycle of disadvantage and receive little help to escape. Of 66 teenagers interviewed for the report, Failed by the System, four out of five had no GCSEs or other educational qualifications when they left school.
Tony Stephenson's experience appears to be typical. "From the start at secondary school, the teachers treat you differently if you are in care. If you don't live with your parents you must be trouble," said the 19-year-old.
The report said bullying at school, lack of stability at home and a lack of support from professionals combine to condemn young people to a cycle of disadvantage. Mr Stephenson, who was in care from the age of two, said: "It was hard to get through a normal week at school. The bullying started as name-calling and exclusion from activities, but then there were also physical attacks.
"In Year 10 the bullying increased and I got so angry that at one point it took eight teachers to hold me down. By the end that year I decided to leave. There was nothing for me at school."
He has since gained NVQ level 2 in catering and hospitality and an IT qualification from Wakefield college. He now works 15 hours a month as a peer involvement co-ordinator for Connexions, Wakefield district.
The report found young people moved homes up to 30 times while in care and had an average of five different schools. An NOP survey of 500 parents commissioned by Barnardo's found, by contrast, that more than half of children never move house in their school years, while only 3 per cent attend five or more schools, Martin Narey, chief executive, Barnardo's, said: "Many looked-after children have both academic potential and the desire to work hard, and would have liked to succeed in education but the state, as a parent, fails them terribly."
The TES's campaign "Time to Care" is calling for action to tackle the gap in achievement between pupils in care and their peers.
* Eight children in care in Ealing, west London were celebrating this week after winning places at university. About 12 per cent of care leavers from the borough go on to university, compared to a national average of 1 per cent.