The two tech behemoths had a "effective duopoly" on mobile ecosystems, according to the report.
HIGHLIGHTS
Restrictions on cloud gaming via the App Store will be looked into as well.
On iPhones, Apple has outlawed browsers other than its own.
According to Google, the Google Play app store has been the launchpad for many apps.
The UK's competition watchdog said it would look into Apple and Google's mobile browser market dominance, as well as the iPhone maker's restrictions on cloud gaming through its app store.
The Competition and Markets Authority (CMA) announced on Friday that it would be pursuing Alphabet's Google for its app store payment practises.
According to the report, the two tech giants had a "effective duopoly" on mobile ecosystems, giving them a stranglehold on operating systems, app stores, and mobile web browsers.
Following the release of a report on mobile ecosystems, CMA Chief Executive Andrea Coscelli stated, "When it comes to how people use mobile phones, Apple and Google hold all the cards."
"As good as many of their services and products are, their strong hold on mobile ecosystems allows them to shut out competitors, limiting choice and holding back the British tech sector."
It claimed that Apple's or Google's browser engines powered 97 percent of all mobile Web browsing in the UK last year, and that Apple had banned alternatives to its own browser on iPhone.
The CMA expressed concern that this would severely limit rival browsers' ability to differentiate themselves from Apple's Safari, for example, in terms of speed and functionality.
Apple said in a statement that its ecosystem has "created a safe and trusted experience users love, as well as a great business opportunity for developers."
"We respectfully disagree with a number of conclusions reached in the report," a spokesperson said, "which discount our investments in innovation, privacy, and user performance — all of which contribute to why users love iPhone and iPad and create a level playing field for small developers to compete on a trusted platform."
"We will continue to work constructively with the CMA to explain how our approach promotes competition and choice while always protecting consumers' privacy and security."
Google claims that smartphones running on its Android operating system give people and businesses more options than any other mobile platform, and that its Google Play app store has helped millions of apps get started.
A Google spokesperson said, "We regularly review how we can best support developers and have reacted quickly to CMA feedback in the past."
"We will continue to work constructively with the CMA to explain how our approach promotes competition and choice while always protecting consumers' privacy and security."
Google claims that smartphones running on its Android operating system give people and businesses more options than any other mobile platform, and that its Google Play app store has helped millions of apps get started.
A Google spokesperson said, "We regularly review how we can best support developers and have reacted quickly to CMA feedback in the past."
