The surprise move will mean some of the world's top athletes are at risk of missing August's Olympic Games in Rio.
Kenya, one of the major forces in world athletics, has already missed two World Anti-Doping Agency (Wada) deadlines to show it is tackling cheating in sport.
Wada's compliance committee ruled the country "non-compliant" when its board met in Montreal on Thursday, citing issues with anti-doping legislation.
The recommendation needs to be ratified by the Wada board.
After a series of drugs and corruption scandals, Kenya had been warned to comply with Wada's rules or face sanctions.
Last month, it finally passed legislation that created a new national anti-doping agency, with President Uhuru Kenyatta personally driving the new law through.
It was widely assumed that the measure would satisfy Wada.
David Were, chair of the Kenya parliament sports and welfare committee which developed the anti-doping bill, said Kenya will appeal the decision.
Were told the BBC he was "shocked" by the decision, adding "we have met all the requirements" and claiming the bill's proposals were "stringent enough".
It will now be up to the International Olympic Committee (IOC) to decide whether to ban Kenyan athletes from the Rio Games or any other competitions.
They could come under pressure to do so, amid an unprecedented doping crisis and mounting concern over the country's lack of action against cheating.
The Olympic participation of another powerhouse athletics nation - Russia - is already in doubt.
In November, the International Association of Athletics Federations (IAAF) banned the country's track and field athletes from international competition following allegations of systemic state-sponsored cheating.
The IAAF, which governs world athletics, will decide on Russia's possible reinstatement in Vienna on 17 June.
Kenya is dominant at distance running, winning 11 medals at London 2012 and topping the table at the World Championships in Beijing last year with seven golds.
But the country has become mired in doping and bribery allegations, with more than 40 of its athletes failing drugs tests since 2011.
In November, former Wada president Dick Pound said it was "pretty clear that there are a lot of performance-enhancing drugs being used" in Kenya.
(BBC News)
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