The London-based group's China director said the Kachins face an impossible situation of either returning to Myanmar, formerly known as Burma, where they face abuse or remaining in China's Yunnan province without adequate food and shelter.
"The Chinese government is not only legally obligated, but fully capable of temporarily protecting Kachin refugees and meeting their basic needs," said Sophie Richardson, Human Rights Watch's China director.
Since June 2011, 7,000 to 10,000 ethnic Kachins have fled war and abuses in Myanmar and sought refuge in southwestern China, Human Rights Watch said.
The 68-page report details the refugees' lack of adequate shelter, food, water, sanitation and basic healthcare.
Their children don't have access to schools while adults who seek day labor often face exploitation by local employers, the report said.
Human Rights Watch said it has documented two instances involving an estimated 300 refugees ordered to return to Myanmar in violation of international conventions.