He also forced the six-year-old to run on a treadmill for more than four hours at a time so she would "sleep well" at night and not disturb him, as well as ordering her to stand in "stress positions", the court heard.
Gatland was arrested in October last year after a friend reported him to the police for child cruelty.
A forensic scientist found traces of cocaine in the six-year-old girl's hair - meaning she had either ingested the class A drug or been exposed to it.
She also had bruises and burns over her back, neck, legs and feet.
The court heard how the 15-year-old boy was regularly beaten and was forced to hide drugs by Gatland.
Prosecutor Angela Rafferty told the jury: "The plight of the children came to light when police were called to the house over a drugs dispute.
"A separate man involved in the dispute told police he heard bangs and the little girl screaming.
"He said the man put his knee in the girls back and pulled her arms back to restrain her.
"He said the girl was hit on the soles of her feet with a wooden spoon and at one point, the woman put a hand over the girl's mouth.
"He said the boy was punched in the head and the girl was locked in her room."
The girl also showed signs of being neglected and told doctors she had frequent abdominal pain, nausea and often went to bed hungry.
The children were taken into foster care where the boy broke down and produced a rubbish bag filled with a dirty nappy, cigarette butts and a broken wooden spoon.
He said the man had tried to dispose of the bag but when he failed, he asked the boy to hide it.
The boy told police that the man abused him and the young girl and said there had been a camera in the young girl's room.
If the girl was seen to move, she was hit by the man. He also said the girl was held under a tap with running water with a flannel on her face.
The prosecution said that the man was caught on a recording saying he hit the girl with a wooden spoon and had tied her up, saying he was "coked off his head".
Miss Rafferty added: "The Crown says that during this trial he [the male defendant] will try to blame the boy for much of his own conduct."
Further evidence proves the man had an "explosive temper", she claimed.
The court heard how the abuse was reported to police by an acquaintance of Gatland in October last year.
A spokesman for Cambridge Police said today:"A man has been convicted of subjecting two children to prolonged abuse and neglect.
"Garth Gatland, 39, of Cambridge was found guilty of two counts of child cruelty at Cambridge Crown Court on May 25.
"The court heard how Gatland abused a girl aged six and a boy aged 15 over a period of two years between 2014 and 2016.
"The abuse of the girl included hitting her repeatedly with implements including a wooden spoon, making her stand naked in the window and making her run for up to four-and-a-half hours barefoot on a treadmill so she would sleep at bed time.
"The girl was also subjected to 'water boarding', made to stand in stress positions and tipped out of her bed while she was sleeping on regular occasions.
"The boy was the victim of regular assaults and made to dispose of and hide drugs for Gatland.
Detective Constable Chris Down said after the case today: "Gatland subjected his victims to a catalogue of sadistic abuse. I hope his conviction will allow the victims to move on with their lives.
"I would encourage anyone who suspects offences have been, or are being committed against children to report their concerns to police, children's social services or the NSPCC.
"No matter who we are, we all have a responsibility to report child abuse."
Gatland was remanded in custody and will be sentenced in the coming months.
A woman called Marie Maltby, 32, who lived with Gatland in Cambridge was acquitted of two counts of child cruelty.
