It accused security forces of regularly committing abuses and said rights and liberties in Egypt were being eroded.
Amnesty's report comes two days before the third anniversary of uprising that forced President Hosni Mubarak to quit.
Meanwhile a pro-Morsi student has been killed in clashes with security forces in Alexandria, officials say.
The dead youth was among hundreds of Islamist students involved in street battles with police in the northern city.
The report by the human rights group said some 1,400 people have been killed in political violence since President Morsi was forced from office by the army in July, after weeks of mass protests.
Egypt's foreign ministry described the report as "tarnishing the facts'' and said the government respected human rights while it was "combating terrorism".
And while he did not mention the report, Egypt's military-backed interim President Adly Mansour gave a speech insisting that the Egypt's police state no longer existed.
In his remarks at Cairo's Police Academy, Mr Mansour said Egypt was starting a "new era'' where police "preserve the dignity of the Egyptian citizen'' and "draws a definitive end to the police state, never to return".
Supporters of Mohammed Morsi, who succeeded Mubarak but was himself ousted from power, are expected to use the anniversary to escalate their protests.
'Verdict on the army'
Struggle to motivate the 'sofa party'
Return to authoritarianism?
In the Amnesty report, its Middle East and North Africa Deputy Director Hassiba Hadj Sahraoui said: "Egypt has witnessed a series of damaging blows to human rights and state violence on an unprecedented scale over the last seven months.
"Three years on, the demands of the '25th January Revolution' for dignity and human rights seem further away than ever. Several of its architects are behind bars and repression and impunity are the order of the day."
There has been "no proper investigation" into the deaths of more than 500 Morsi supporters when the army forcibly dispersed their sit-in protest in Rabaa al-Adawiya Square last August, the report noted.
"Instead of reining in the security forces, the authorities have effectively handed them a mandate for repression," said Hassiba Hadj Sahraoui.
"Once again in Egypt, the rhetoric of 'countering terrorism' is being used to justify sweeping crackdowns that fail to distinguish between legitimate dissent and violent attacks."
The report calls for the security forces to be held accountable for human rights violations and urges the authorities to "loosen their stranglehold on civil society and allow peaceful protests and other avenues for lawful dissent".
Egypt's military-installed interim government insists it is committed to democracy; presidential and parliamentary elections are due to be held in the coming months.
But critics fear Egypt is on course for a return to authoritarian rule.
In recent months, liberal activists have been arrested and detained as well as thousands of supporters of the now-banned Muslim Brotherhood.
Egypt has seen violence "on an unprecedented scale" since the army ousted Islamist President Mohamed Morsi last July, Amnesty International says.