"The systems designed to address and prevent childhood lead poisoning are, at best, fragmented and inadequate and, at worst, ripe for negligence and fraud," the report reads.
Exposure to lead can cause everything from behavioral problems and hyperactivity to developmental delays and brain damage.
Gov. Jon S. Corzine was expected to sign an executive order Tuesday tightening lead poisoning prevention measures.
New Jersey's rate of lead poisoning is above the national average and one of the highest in the Northeast, according to the report.
The study concentrated on five New Jersey cities that accounted for more than 30 percent of the state's lead poisoning cases in 2005: Trenton, Camden, Newark, East Orange and Irvington. It also cited Paterson as having one of the highest rates of lead poisoning among children - with 5 percent of those tested showing symptoms.
More than half of New Jersey's housing was built before 1978 - the year the sale of lead paint was banned. The report says that's why the problem is especially prevalent in urban areas with older buildings.
It found that New Jersey's lead poisoning policies - like most states - are too focused on dealing with lead problems after a poisoning occurs, instead of concentrating on prevention and education.
The state's failure to enforce lead paint regulations has contributed not only to human suffering, but to higher health and education costs in dealing with lead poisoning's long-term affects, the study found.
It cited cases where children were returned to homes that had been certified as lead-free but were still exposed to dangerously toxic levels. In some cases, children's blood lead levels measured higher after a home underwent remediation.
In other cases, the same companies hired to make an apartment lead-free were also charged with inspecting and approving their own work.
"Abatement contractors get away with shoddy, inferior work because legal standards governing their performance are amorphous," the report stated.
The report recommended lowering New Jersey's acceptable lead level thresholds and banning the practice of allowing the same company to be in charge of lead paint inspections as was in charge of removal. It advocates for improved housing assistance and temporary relocation programs for families whose homes are undergoing lead remediation, and said lead poisoning education programs should be expanded.
