China is "the most threatening actor in cyberspace" as its intelligence agencies and hackers use increasingly sophisticated techniques to gain access to U.S. military computers and defense contractors, according to the draft of an annual report mandated by Congress.

Chinese hackers are moving into "increasingly advanced types of operations or operations against specialized targets," such as sensors and apertures on deployed U.S. military platforms, according to the report.

"China's persistence, combined with notable advancements in exploitation activities over the past year, poses growing challenges to information systems and their users," the U.S.-China Economic and Security Review Commission said in the draft obtained by Bloomberg News. "Chinese penetrations of defense systems threaten the U.S. military's readiness and ability to operate."