Rosemary Kayess, Australia's disability discrimination commissioner, delivered the grim warning during a Senate inquiry into the insurance scheme.
As the federal government prepares to cut funding and tighten eligibility for the $56 billion-a-year program, Ms Kayess said disabled people were at risk of losing their rights to work and socialise.
"The issue this bill raises is whether the reforms maintain the NDIS as a rights-based scheme or regress from human rights principles and standards," she told the inquiry on Wednesday.
"Our central concern is that, taken as a whole, the bill represents a structural shift in how disability is understood and how support needs are assessed and funded."
The government hopes to curb spiralling costs by moving thousands of people with more mild and moderate disabilities onto other supports run by the states, cutting funding used for community involvement by 50 per cent, and giving the NDIS minister the power to decide how much funding cohorts can receive.
Ms Kayess said disabilities needed to be understood as being impacted by environment and access, which the government was not adequately considering.
"This bill is suggesting that they can abstract out a person's impairment and just provide supports that relate only to that impairment," she said.
"Someone's circumstances and what somebody wants to do and does do on a day-to-day basis is irrelevant."
Disability groups have warned the three-day Senate inquiry was not enough to reasonably interrogate a huge swathe of proposed changes.
"The systems aren't ready. If the systems aren't ready for reform, then there should be no transition," Australian Autism Alliance co-chair Jenny Karavolos told AAP.
"People will be without support. People will leave their jobs. Carers who are supporting people will need to take a bigger load ... there's increased mental health costs, increased family stress, increased future support needs."
The proposed changes' passage into law is not guaranteed.
The Greens are opposed and while the coalition backs the principle of the changes, it is threatening to hold the bill hostage to gain political leverage on unrelated reforms to tax on investments.