Companies in the future may use brain-monitoring technology to watch or hire workers, the data watchdog says.
But there is a real danger of discrimination if "neurotech" is not developed and used properly, the Information Commissioner's Office says.
Tech Futures: Neurotechnology is the first ICO report on "neurodata", data from the brain and nervous system.
Workplace monitoring is one of a number of hypothetical future uses of neurotech explored in the report.
It comes as companies such as Elon Musk's Neuralink explore new ways to let computers connect to human brains.
"Based on all the indicators that we're looking at, we're seeing quite rapid growth, both in investments and in patents being developed in this area," the ICO's Stephen Almond told BBC News.
Neurotech is already used in the healthcare sector, where there are strict regulations, the ICO says.
Electronic implants in the brain of Gert-Jan Oskam, paralysed in a cycling accident 12 years ago, enabled him to walk again.
And commercial interest in the technology is growing.
Neuralink has won permission for human trials of its implantable brain-computer interface and is reportedly now worth $5bn (£4bn) though a long way from a commercial product.
Artificial Intelligence is also opening up new possibilities, with research projects now able to decipher sentences and words just from brain scans. This might eventually help patients with locked-in syndrome, who are conscious but cannot move or speak.
But the report focuses on technologies that might emerge in the future, which it uses as hypothetical examples to explore the issues raised by neurodata.
In four to five years, the ICO suggests, "as employee tracking expands, the workplace may routinely deploy neurotechnology for safety, productivity and recruitment".
Helmets or safety equipment might measure the attention and focus of an employee in high risk environments.
And bosses might use it to assess how individuals reacted to workplace stress, Mr Almond said.
In the longer term in education wearable brain monitoring devices might be used to measure students' concentration levels and stress levels.
"Neuromarketing" is already in limited use in small, controlled research settings - with consumers' responses to products assessed using medical devices that measure brain activity - although, there is significant debate about its merits
In the future, "non-invasive devices capable of reading responses may be used at home to tailor consumer preferences", the ICO says.
In one admittedly far-fetched example the report imagines in the future neurotechnology-enabled headphones might gather data used to target advertising.
It also sees growth in gaming and entertainment - some games and drones are already controlled by devices that take readings of the brain.
But the ICO is worried the technology could cause discrimination, unless developed carefully.
The technology itself could be biased, giving incorrect answers when analysing certain groups, Mr Almond said.
But there was also the risk bosses could use it to discriminate against "certain types of more neurodivergent characteristics".
It might reveal conditions of which the subject themselves was unaware.
And it raised tricky questions around consent. Neurodata is subconsciously generated, the report says, and people have no direct control over the specific information which is disclosed.
"If you don't know what the technology is going to reveal about you, can you really consent in advance to the processing of that personal data about you?" Mr Almond said. "Because once it's released into the open, you then have relatively lower control over it."
The ICO hopes to complete new neurodata guidance by 2025.