New Zealand consumers may have been bamboozled by clothing companies' "misleading" claims, a consumer watchdog says.

Kiwi companies selling bamboo clothing are updating their labelling after Consumer NZ raised concerns that labels may be misleading to customers.

A Consumer NZ investigation, published in the February edition of its magazine, found most clothing sold in shops labelled as being made of bamboo was actually made out of rayon, or viscose.

Rayon, or viscose, is a fibre made from plants and trees, including bamboo, through a chemical process. "Companies that label clothing as 'made from bamboo' are misleading customers. Most 'bamboo' textiles are rayon and should be labelled as such," Consumer NZ said.

The report also raised concerns about clothing manufacturers that advertise their bamboo clothes as anti-bacterial. Last year, the United States Federal Trade Commission (FTC) released a statement saying, "Bamboo-based textiles, actually made of rayon, are not antimicrobial, made in an environmentally friendly manner, or biodegradable."

The FTC charged four US companies with deceptively labelling and advertising textile items as made of bamboo, when they were made of rayon. It also noted "rayon does not retain any natural antimicrobial properties of the bamboo plant".

NZ Nature's communications manager Wendy Riley said the company was reviewing how its bamboo products were labelled.

The company advertises its bamboo clothing range as anti- bacterial and eco-friendly.

The products were made through converting bamboo to viscose, Riley said.

Meredith Barry-Walsh, the co- owner of Baby clothes maker Green Bean, said it planned to have its products labelled as 95 per cent rayon from bamboo by March or April.

The clothes were labelled as 95 per cent bamboo, and 5 per cent spandex. She said she was following American clothes labelling guidelines as there were none in New Zealand.

Barry-Walsh said consumers would not see the clothes differently. "Studies have shown once a garment has been made up from bamboo it holds its anti- bacterial properties," she said.

Head of design with Jockey underwear Nigel Eru said the company was updating its labels to reflect its clothes are manufactured using the viscose process.

Bamboo did not have any "specific anti-bacterial properties" but it was "ecological friendly".

Commerce Commission spokeswoman Felicity Connell said there was no specific legislation governing bamboo.

"The New Zealand regulations are not as specific as fibre derived from bamboo cellulose must be labelled as 'rayon'."

However, labelling of textile products must be accurate, she said. "It can also be a breach of the Fair Trading Act to make a false representation or mislead about the fibre content of the goods. Only the courts can rule whether the Fair Trading Act has been breached and set appropriate penalties."