The report cited the case of Army Sgt. Darren Manzella, who appeared on the CBS program "60 Minutes" three weeks ago. In the interview, Manzella said his fellow soldiers knew he was gay and showed a home video of him kissing his boyfriend.
He told USA Today he told his commander he was gay in 2006, and the Army investigated and saw the kissing home video.
"They found 'no evidence of homosexuality,'" Manzella said.
U.S. President Bill Clinton approved the "don't ask, don't tell" policy in 1993 and about 12,000 troops have since been discharged for saying they were gay, the report said.
Eugene Fidell of the National Institute of Military Justice, a group of military legal experts, said with wars in Afghanistan and Iraq, discharging troops was questionable.
"Military managers may be turning a blind eye because it's a nuisance and we need these people," he said to USA Today.