Black people are three times more likely to be admitted to mental health hospitals than the rest of the population, a health watchdog has said.
The death of David Bennett raised concerns about the NHS
The Healthcare Commission carried out a census of 34,000 mental health hospital patients in England and Wales.
It said that finding the reason for its results should be a matter of urgency.
Mental health campaigners said the findings were "shocking" but the government said they would be used to measure progress in ending inequality.
It has long been known that black people were more likely to end up in mental health hospitals, but the census gives the clearest indication yet of the true figures.
The census was announced after the government pledged to "eradicate discrimination" in NHS mental health care following a report into the death of patient David Bennett which said there was "institutional racism" in the NHS.
Mr Bennett died after being restrained at a Norfolk clinic in 1998.
The Healthcare Commission, in conjunction with the Mental Health Act Commission and National Institute for Mental Health in England, analysed data from all 102 NHS trusts and 110 private providers in England and Wales.
They found 9% of inpatients were black despite the ethnic group representing just 3.2% of the population.
The study also found black people were 44% more likely to end up being detained under the Mental Health Act than the average.
The rest of the ethnic groups, including white British, Irish and south east Asian, had broadly average rates.
People with mental health problems can be detained if they pose a risk to themselves or others and can be treated.
Black people were also nearly twice as likely to get referred for treatment via the courts than the average of 2.4% and experienced higher rates of seclusion and restraint once in hospital.
The watchdog said levels of poverty were not taken into account during the census and these could affect the findings.
Healthcare Commission chairman Sir Ian Kennedy said: "This census demands an explanation. It does not provide one. The job of discovering the reason behind the data must be undertaken with urgency.
"It would be wrong and intolerable if someone was categorised as mentally ill and hospitalised solely on the basis of colour or ethnic origin."
But he said it would be equally wrong for someone who needed hospital care not to get it because the person charged with making the decision feared being accused of racism.
Sainsbury Centre for Mental Health chief executive Angela Greatley said the inequalities which had been laid bare were "shocking".
"This is a glaring inequality in health care.
"African and Caribbean people are being admitted to hospital as a first resort before other courses of action are considered."
Health minister Rosie Winterton said: "Racism or discrimination in any form have no place in modern health or social care - they are an affront to the core values of the NHS.
"The results of the census will act as a benchmark for measuring our progress in bringing those inequalities to an end."
And the Commission for Racial Equality said the census confirmed longstanding concerns and that it would be monitoring the attempts to address the situation.