Such a designation, rare under international law, would mark the first recognized genocide carried out by non-state actors, rather than a state or paramilitaries acting on its behalf, as reported by Reuters.
The U.N. report, based on interviews with dozens of survivors, said the Islamist militants had been systematically rounding up Yazidis in Iraq and Syria since August 2014, seeking to "erase their identity" in a campaign that met the definition of the crime as defined under the 1948 Genocide Convention.
"The genocide of the Yazidis is ongoing," it said.
The 40-page report, entitled "They Came to Destroy: ISIS Crimes against the Yazidis", sets out a legal analysis of Islamic State's intent to wipe out the Kurdish-speaking group, whom the Sunni Muslim Arab militants view as infidels.
The Yazidis are a religious sect whose beliefs combine elements of several ancient Middle Eastern religions.
"The finding of genocide must trigger much more assertive action at the political level, including at the (U.N.) Security Council," Paulo Pinheiro, chairman of the commission of inquiry, told a news briefing.
"Almost two years since the attack on Mount Sinjar, nothing has been done to save those people," he said, referring to the heart of the Yazidi region in northern Iraq stormed by Islamic State in August 2014.
Commission member Vitit Muntarbhorn said it had "detailed information on places, violations and names of the perpetrators", and had begun sharing confidential testimony with some national authorities aiming to prosecute militant citizens.
The independent commissioners urged major powers to rescue at least 3,200 women and children still held by Islamic State (IS or ISIS), mainly in Syria, and to refer the case to the International Criminal Court (ICC) for prosecution.
Iraq and Syria also have a duty to prevent, punish, and prosecute genocide, having ratified the Convention, they said.
Historical victims of genocide include Armenians in 1915, Jews during the Nazi Holocaust, Tutsis in Rwanda in 1994 and Bosnian Muslims in Srebrenica in 1995.
"ISIS made no secret of its intent to destroy the Yazidis of Sinjar, and that is one of the elements that allowed us to conclude their actions amount to genocide," said another investigator, Carla del Ponte.
"Of course, we regard that as a road map for prosecution, for future prosecution. I hope that the Security Council will do it because it is time now to start to obtain justice for the victims," added del Ponte, a former U.N. war crimes prosecutor.
The five permanent members of Security Council – Britain, China, France, Russia and the United States – have agreed on the need to fight ISIS, "so it should be no problem at all to have a decision that a prosecution can be done," she said.
Read alsoWSJ: U.S. State Department officials call for strikes against Syria's AssadIslamic State, which has proclaimed a theocratic caliphate – based on a radical interpretation of Sunni Islam – in areas of Iraq and Syria under its control, systematically killed, captured or enslaved thousands of Yazidis when it overran the town of Sinjar in northern Iraq in August 2014.
At least 30 mass graves have been uncovered, the report said, calling for further investigations.
Islamic State has tried to erase the Yazidis' identity by forcing men to choose between conversion to Islam and death, raping girls as young as nine, selling women at slave markets, and drafting boys to fight, the U.N. report said.
Yazidi women are treated as "chattel" at slave markets and some are sold back to their families for $10,000 to $40,000 after captivity and multiple rapes, according to the report.
Militants have begun holding "online slave auctions", using the encrypted application Telegraph to circulate photos of captured Yazidi women and girls, "with details of their age, marital status, current location and price"," it said.
"No other religious group present in ISIS-controlled areas of Syria and Iraq has been subjected to the destruction that the Yazidis have suffered," the report added.