The report co-authored by former Guardian reporter Glenn Greenwald for the online news site The Intercept said the programme has dramatically expanded the US spy agency's ability to covertly hack into computers on a mass scale.
The report is based on classified documents provided by former NSA contractor Edward Snowden.
It said the surveillance technology allows the NSA to infect potentially millions of computers worldwide with malware "implants" which can help the agency extract data from overseas Internet and phone networks.
The automated system codenamed TURBINE expands the ability to gather intelligence with less human oversight, according to the report.
The report was the first by Greenwald based on leaked documents since he joined First Look Media, an organisation backed by tech entrepreneur Pierre Omidyar that includes The Intercept.
Greenwald was among the first journalists to publish documents leaked by Snowden describing the vast surveillance programmes of the NSA and other intelligence services, sparking a massive outcry.
The report said that in some cases the NSA has used a decoy Facebook server to infect a target's computer and exfiltrate files.
It said the malware can also covertly record audio from a computer's microphone and take snapshots with its webcam.
The Intercept said the malware has been in existence since 2004 but that the automated programme expanding its use appears to have begun in 2010.
Because people have become suspicious of email attachments, the report said the NSA has had to resort to new tools to install the malware such as "man-in-the-middle" and "man-on-the-side" attacks through Internet browsers.
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