Days ahead of the fourth anniversary of the law coming into force, the rights watchdog urged Russia to reverse the "devastating consequences" for activist groups and "repeal the 'foreign agents' law".
The law obliges groups with so-called "political" activities and international funding to call themselves "foreign agents", a term that recalls Stalin-era repression and Cold War espionage.
The rules have seen some organisations reject much-needed funding from abroad, while others have closed down since it took effect on November 21, 2012.
"Many organisations have closed. Others have reduced the extent of their activities," Amnesty's Russia director Sergei Nikitin said at a news conference in Moscow.
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"The number of services offered by NGOs has fallen significantly."
President Vladimir Putin approved the law shortly after his reelection, following a wave of huge public protests against his return to power. It has ushered in a massive crackdown on civil society.
In the last four years, 148 non-governmental organisations have been included on the list of "foreign agents" in Russia, of which 27 have closed down altogether, Amnesty said.
It called on Russia to cancel the law and meanwhile immediately suspend its use and cease adding new groups to the list.
The law "was designed to shackle, stigmatise, and ultimately silence critical NGOs," Amnesty's Nikitin said.
Russia has used the law to label the most prominent groups that criticise government policy, including the leading Memorial rights organisation and Golos election observer group as well as HIV-prevention groups, ecological activists and those who work with victims of torture.
He said that the "foreign agent" tag was "a dirty political label" that is not a legal term.
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