The WHO researchers defined processed meat as anything transformed to improve its flavor or preserve it, including sausages, beef jerky and anything smoked. They defined red meat to include beef, veal, pork, lamb, mutton, horse and goat.
The report said grilling, pan-frying or other high-temperature methods of cooking red meat produce the highest amounts of chemicals suspected of causing cancer.
"This is an important step in helping individuals make healthier dietary choices to reduce their risk of colorectal cancer in particular," said Susan Gapstur of the American Cancer Society, which has recommended limiting red and processed meat intake since 2002, and suggests choosing fish or poultry or cooking red meat at low temperatures.
The North American Meat Institute argued in a statement that "cancer is a complex disease not caused by single foods."
Independent experts stressed that the WHO findings should be kept in perspective.
"Three cigarettes per day increases the risk of lung cancer sixfold," or 500 percent, compared with the 18 percent from eating a couple slices of bologna a day, said Gunter Kuhnle, a food nutrition scientist at the University of Reading.
"This is still very relevant from a public health point of view, as there are more than 30,000 new cases per year" of colon cancer, he said. "But it should not be used for scaremongering."
AP Medical Writer Mike Stobbe in New York contributed to this report.