Almost half of the alleged bullying in the federal bureaucracy is thought to be based on personality differences.
A further one in three cases relates to attempts to improve staff performance, public servants say.
The latest State of the Service Report says about one in six government employees believe they were harassed in the workplace in 2011-12.
However, while bullying can lead to steep penalties, only 43 per cent of alleged victims reported the behaviour.
Of those who failed to blow the whistle, 50 per cent said they believed no action would be taken, 40 per cent feared it would affect their career and 39 per cent did not want to upset their relationships with colleagues.
The report, based on an annual census of the Australian Public Service, says employees cited two main reasons for bullying: personality differences (46 per cent) and work performance (30 per cent).
When asked how bullying manifested, half said as verbal abuse (such as offensive language or shouting) and 43 per cent cited unfair application of workplace policies (such as harsh performance assessments or limited access to leave and training).
The level of reported harassment in the APS has remained largely unchanged over the past decade.
Only 235 staff were investigated formally for alleged bullying in 2011-12 - fewer than one in 700 federal public servants - and, of those, just two in three were deemed guilty.
However, Public Service Commissioner Stephen Sedgwick said the number of staff who believed they had been harassed remained worryingly high.
''It is incumbent on all of us to speak out about inappropriate behaviour we witness - even where the alleged perpetrator is a senior executive or a ministerial staff member - and for those in authority to deal with such allegations professionally and effectively,'' he said.
Mr Sedgwick noted the large number of alleged victims who linked bullying with people management.
He said it might suggest ''that supervisory relationships in the APS are not always well managed or well understood by those involved - perhaps especially in the arena of performance management''.
''These findings suggest there is work to do to support employees and managers in the giving and receiving of feedback, and in fostering productive and respectful relationships more broadly.''
A recent parliamentary inquiry into workplace bullying heard allegations that some public service managers used a mental health test - the ''fit for duty'' exam - as a form of bullying staff. It recommended the government review how the test was used and what safeguards were in place to ensure it was not used as a form of retaliation.