Those sent to vocational educational and employment training centres were criminals convicted of minor offences, it said.
China over the past few months has faced flak over its counter-terrorism policies in Xinjiang, which included creating internment camps in which up to a million Uyghur Muslims were detained and subjected to ideological reorientation.
"It's a retrospective justification for the mass detainment of Uighurs, Kazakhs, and other Muslim minorities in Xinjiang", said James Leibold, a scholar of Chinese ethnic policies at La Trobe University in Melbourne.
China launched its "Strike Hard" campaign targeting separatism in Xinjiang in 2014 following deadly violence in the region.
Rights groups say detainees are made to swear loyalty to President Xi Jinping and criticise or renounce their faith.
China said anti-terror efforts in controversial "reeducation centres" in China's Xinjiang region will be governed by new standardised rules.
The next day, Tianshan, a news portal run by the Xinjiang government, published a fiery essay hailing the region's crackdown as an "emancipation of the mind". China accuses Islamist militants and separatists of orchestrating the trouble.
It isn't the first time China has cracked down on elements of the Muslim faith in Xinjiang.
Rights groups have criticised the move.
But it is clear their objective is not just about giving people the ability to get a better job. "Because the West has failed in doing so, in dealing with religious Islamic extremism".
China has also justified its method of "training" religious extremists as "the necessary way to deal with Islamic or religious extremism". It wants to stop the use of halal products that are not food.
New regulations also make it clear that Muslim women are banned from wearing veils.
The Urumqi Communist Party leaders also said they would require government officials and party members to firmly believe in Marxism-Leninism, and not religion, and to speak standard Mandarin Chinese in public.
Former prisoners of the camps have told the BBC of physical as well as psychological torture there.
"This strategy seems to be one of cultural and political re-engineering of the entire population", he said.
Detainees were ordered to chant "Thank the Party!"
"In the end, all the officials had one key point".
Rubio noted the report's recommendations include embedding the issue of human rights in all aspects of bilateral relations and holding Chinese officials accountable for abuses, through sanctions, visa restrictions and other methods.
Officials in Xinjiang, the western Chinese region where 11 million Uighurs live, revised a local law to encourage "re-education institutions" to help those "affected by extremism".
They see themselves as culturally and ethnically close to Central Asian nations, and their language is similar to Turkish.
Beijing has spent decades trying to suppress pro-independence sentiment in Xinjiang fueled in part by frustration about an influx of migrants from China's Han majority.
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