According to the report, which was released today, while the US government invested more than $80 billion on information technology last year, much of the money -- 75 percent or $60 billion -- was spent operating and maintaining aging systems. The report said the other 25 percent was used for new development.
"Legacy federal IT investments are becoming obsolete," the report said.
"These poor people that work there. They're coming to work with their iPhones and then working on a system that was developed literally in the 1950s or maybe the 1960s," said US Rep. Jason Chaffetz, R-Utah.
David Powner, a GAO information technology expert, told the House Oversight and Government Reform Committee today at a hearing that billions were being "wasted."
At least one agency told ABC News today that major changes were on their way.
The Air Force's Strategic Automated Command and Control System -- which supports the Air Force's ICBM missile fleet and dates back to the 1970s -- started using floppy disks in 1988 and has continued using them. Floppy disks are still used "because it accomplished the required tasks we used the system for, meaning it would have been fiscally unnecessary to make the change," said Capt. Christopher Mesnard, a spokesman for the Air Force Global Strike Command.
The report said that the Defense Department was still using 8-inch floppy disks to store information. About 3 million floppy disks could store the same information as the average flash drive -- and cost about $7.5 million less.
"You have to think that just one good trip to Best Buy, you'd be better off than what you're doing now," Chaffetz said. "Making this sea change, this massive change, is tough but it's about time. ... These are vulnerable systems."
The Air Force is already transitioning to a new SD card and reader system to replace the floppy and drive system. The new system is smaller and will "alleviate anticipated growing costs associated with maintaining the obsolete floppy system," Mesnard said.
Chaffetz said many of the systems also lacked data encryption and dual authentication.
"When I was a little kid, I was watching movies that had these 8-inch floppy disks and they're still being used," Chaffetz said. "I don't even know where they buy these things."
"We're taking kids graduating with degrees in information technology and dumbing them down so they can learn what they were doing back in 1960," Chaffetz said.
ABC News' Mary Bruce and The Associated Press contributed to this story.