Background: Exercise therapy is a standard method used for alleviation of chronic neck pain (CNP). However, few studies have compared the efficacy of acupuncture to exercise therapy on functional improvement and pain reduction. Acupuncture will cause more pain relief and functional improvement compared to exercise therapy in the patients with CNP. Methods: A randomized clinical trial was conducted in Rasool-e-Akram Hospital from September 2017 to October 2018. A total of 68 patients with CNP were randomized to receive either exercise therapy or acupuncture. Clinical outcome was documented at baseline, after 6 and 12 weeks based on the Neck Disability Index (NDI) and the Neck Pain and Disability Scale (NPDS). Results: In patients treated with acupuncture, mean NPDS and NDI values were 56.309 and 20.35, respectively. In patients undergoing physical therapy these values were 52.912 and 21.50, respectively. No significant difference in pain and function was observed between the two groups at the final follow-up (P > 0.05). Likewise, neck pain and function improved significantly in both groups at the follow-up points (P < 0.001). Conclusions: In the patients with CNP and radicular neck pain, acupuncture and exercise therapy were equally effective on pain reduction and functional improvement.