WASHINGTON—Officials at the Federal Trade Commission concluded in 2012 that Google Inc. used anticompetitive tactics and abused its monopoly power in ways that harmed Internet users and rivals, a far harsher analysis of Google’s business than was previously known.

The staff report from the agency’s bureau of competition recommended the commission bring a lawsuit challenging three Google practices. The move would have triggered one of the highest-profile antitrust cases since the Justice Department sued Microsoft Corp. in the...