The report referred to the "masculine culture" of the Air Force, said verbal sexual harassment was "normalised" and some men could not distinguish between consensual and harmful sexual behaviour.
Some women had not reported harassment because they did not think it would be treated seriously or were concerned they would be "ostracised".
"The review identified long held and widespread sexist attitudes and ongoing gross and derogatory sexist comments directed towards women including anti-female attitudes and behaviour, which impacted on their desire to remain in the Air Force."
It said older males, especially in command roles, were identified as often showing anti-female attitudes.
It said some women said they felt safer in the Air Force because of the "family" atmosphere and a protective attitude by their male counterparts.
However, others reported instances in which they felt it was safer to agree to sex, especially with a higher ranked officer. Most said alcohol misuse was a factor, but said the drinking culture had changed.
Lieutenant General Tim Keating said it showed being a woman in the Defence Force was still harder than it should be.
"There continue to be pockets of people that think it acceptable to belittle, ridicule and at its worst, harass and even assault their colleagues. That's unacceptable."
He said such actions diminished the Defence Force in the eyes of its personnel and the public.
He said the Defence Force had already introduced new ways of recruiting, retaining and supporting our women in uniform but still had problems with its underlying culture.
The Operation Respect plan was aimed at changing that and included introducing a restricted disclosure system by the end of June to provide an alternative way to report sexual assault rather than through the command structure.
It was also introducing a dedicated, professional sexual assault response team and would move on problems such as alcohol misuse as well as training.
Operation Respect was intended to implement the reviews recommendations of processes for dealing with claims of harassment and sexual behaviour, including educating new recruits about sexual ethics, alcohol management, and establishing an impartial specialist process for those concerned about harassment.
Defence Minister Gerry Brownlee said sexually inappropriate behaviour was was "intolerable" behaviour and the Defence Force was moving to try to eradicate it. He said for most in the Defence Force a culture change would not be a challenge "but there are bound to be a few for whom it would be a challenge and that's why you have those policies in place."
