The attack is the latest salvo in a long-running battle between the media regulator and The Advert Channel, which began broadcasting in summer 2004 and is now known as Your TV.
As well as the editorial material about advertising, the channel also features a psychic-related strand called Your Destiny TV, which has come in for particular criticism in Ofcom's investigation.
Ofcom said that the degree of prominence given by the broadcaster to the promotions of individual psychics and access to them via premium rate numbers blurred the line between editorial content and advertising.
The watchdog also aired concerns that there it was difficult for viewers to distinguish between advertising and TV strands.
In its report, Ofcom said: "It was unclear to us, and would certainly have been unclear to viewers, whether we/they were watching advertising or programming.
"We remained seriously concerned that the broadcaster seemed not to understand what was required to comply with Ofcom's codes, especially in view of the earlier meeting and the substantial volume of correspondence since summer 2004."
The regulator has warned the Advert Channel that it will face fines if it continues to breach Ofcom programming codes.
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