The British broadcaster was found to have committed a "major breach" of media regulations by failing to disclose that the presenter of a film about Gaza was the offspring of a Hamas administrator, according to regulatory body Ofcom.
An inquiry by the media regulator into the documentary titled Gaza: How to Survive a Warzone has concluded that the documentary was "significantly deceptive".
The BBC's director general had earlier expressed regret, stating there had been "a serious error in relation to factual correctness".
The regulator has instructed the BBC to broadcast a peak-time declaration about its conclusions.
"Since this amounts to a significant violation of our regulations, we are instructing the BBC to transmit a announcement of our findings against it on BBC2 at nine o'clock in the evening, with a schedule to be finalised," the statement read.
'Risk to Erode Credibility'
The regulator's report stated: "Our investigation determined that the film's failure to disclose that the voice's parent occupied a role in the Hamas-administered administration was materially misleading.
"It meant that the public did not have vital facts which may have been extremely pertinent to their assessment of the narrator and the information he shared.
"Credibility is at the center of the connection between a broadcaster and its public, especially for a national broadcasting corporation such as the BBC.
"This error had the risk to damage the exceptionally strong amounts of trust that viewers would have put in a documentary produced by the BBC about the Israel-Gaza war."
The documentary was withdrawn from the online platform in February after the presenter's familial connections came to light, and in this past July an internal BBC review determined it breached the corporation's journalistic standards on factual correctness.
A BBC spokesperson stated: "The Ofcom ruling is in accordance with the findings of Peter Johnston's review, that there was a significant failing in the documentary in relation to the broadcaster's journalistic policies on accuracy, which reflects clause 2.2 of the regulator's media standards.
"We expressed regret for this and we agree with Ofcom's decision in full. We will adhere to the directive as soon as the timing and wording are determined."
