The group says that although clean air standards are in place to cut back pollution, they are not being enforced and nearly 400 counties in the United States have smog levels above the legal limits.
"It is clearly time to get serious about enforcing all of the provisions of the Clean Air Act so that we place Americans' health above business and political interests," said John Kirkwood, president and chief executive officer of the American Lung Association.
Kirkwood said industry is fighting to roll back important provisions of the Clean Air Act, and ozone standards set in 1997 are still not being enforced.
"More protective ozone standards effectively have been on hold due to challenges by industry, which have kept states relying on weaker standards they have used since 1979," Kirkwood said.
Ozone levels have been linked with poor air quality, smog, asthma and other respiratory conditions.
A coalition of business groups, led by the American Trucking Association, filed a lawsuit seeking to overturn the Environmental Protection Agency's 1997 pollution standards saying they were arbitrary and had no scientific basis.
But last month, the U.S. Court of Appeals for the District of Columbia Circuit rejected the argument, saying the EPA "must err on the side of caution" and set pollution standards at "whatever level it deems necessary and sufficient to protect the public health."
Other legal issues also are still unresolved concerning the pollution standards - which the EPA estimates would prevent 15,000 premature deaths, 350,000 cases of asthma and 1 million cases of decreased lung function in children.
"Somehow, industry believes it needs to continue to pollute," Kirkwood said. "They have fought every step we have taken toward cleaner air for all Americans. Now is the time for EPA to act."
According to the association's report, the 10 most polluted areas were Los Angeles, Riverside and Orange County in southern California; Bakersfield, Fresno, Visalia, Tulare and Porterville, California; Houston, Galveston and Brazoria, Texas; Atlanta; Merced, California; Knoxville, Tennessee; Charlotte, North Carolina, and neighboring Rockville, South Carolina, and Sacramento, California.
The cleanest big cities included Bellingham, Washington, Colorado Springs, Colorado, and Lincoln, Nebraska.
The report is based on Environmental Protection Agency data from 1998-2000 measuring the number of days that pollution exceeds the EPA's air quality index for ozone, commonly called smog. It did not take into account improvements in the past year.
Ozone pollution forms when emissions from fuel combustion combine with sunlight, creating a chemical reaction that chokes the air and leaves a brown haze visible on the horizon. California's smog is worsened by the state's dense population and a topography that traps air pollution.
This is the third year in a row that counties in the Los Angeles area have topped the smog list.
"This report is really focused on ozone pollution as a national problem, but we're most famous for it in California," said Dr. John Balmes, president of the association's medical section.
Los Angeles does has achievements on the plus side of the ledger. Since 1985, it has reduced smog by 75 percent. The state of California has also made considerable progress, reducing smog by two-thirds over the past two decades.
"There's been real progress, but it's a tough battle," said Richard Varenchik, deputy communications director for the California Air Resources Board.