Ethiopia has already leased out more than 3.6 million hectares (8.8m acres) of land - an area the size of The Netherlands - HRW says.
Addis Ababa rejects HRW's allegations.
"Human Rights Watch has wrongly alleged the villagisation programme to be unpopular and problematic," government spokesman Bereket Simon told Reuters news agency.
"There is no evidence to back the claim. This programme is taking place with the full preparation and participation of regional authorities, the government and residents," he said.
'Weaker and weaker' HRW says it has evidence that some 70,000 indigenous people were relocated against their will to new villages that "lack adequate food, farmland, healthcare and educational facilities".
The group said it spoke to more than 100 people in May and June last year for the report.
"My father was beaten for refusing to go along [to the new village] with some other elders," a former villager told HRW.
"He said: 'I was born here - my children were born here - I am too old to move so I will stay'. He was beaten by the army with sticks and the butt of a gun.
"He had to be taken to hospital. He died because of the beating - he just became weaker and weaker."
The government has said in the past that all the moves are voluntary, the new villages will have adequate infrastructure and everyone who moves will be given assistance to help their transition to a new livelihood.
But HRW says many of the new villages have no access to government services at all, and people are arriving at the worst time of year - the beginning of the harvest - to find the land has not been cleared and prepared for growing.
"The government failure to provide food assistance for relocated people has caused endemic hunger and cases of starvation," HRW says.