"My advice to the president is not to sign the bill," Vinand Nantulya, who chairs the Uganda AIDS Commission -- a government-run body, told reporters.
Uganda's parliament passed new legislation criminalising the deliberate transmission of HIV -- the virus that can lead to AIDS -- in May.
MPs argue that the move is necessary to halt a rise in infections, but rights groups argue that the new law -- if signed by President Yoweri Museveni -- will only further stigmatise those living with HIV and dissuade people from getting tested.
On Friday, the government's own AIDS body said the law would hamper efforts to stem the spread of the virus.
"If this is the law, then a right thinking a person would not get tested... so that if he transmits the virus, he can always claim that he did not know he was positive," said Nantulya, describing the bill as "nonsensical".
"But is this what we want? No! We want people to get tested so we can put them on treatment."
Uganda was once heralded as a success story in the fight against HIV, with Museveni among the first African leaders to speak openly about AIDS.
The government mounted a highly successful public awareness campaign in the late 1980s and 1990s, causing infection rates to drop from double to single digits.
But according to the most recent statistics, the national prevalence rate rose to 7.3 percent in 2011, from 6.4 percent in 2004-05, with health officials blaming increased complacency.