Some black and minority ethnic groups are three times more likely to be admitted to hospital for mental health problems, figures show.
The census looked at 257 NHS and independent institutions
The Healthcare Commission said agencies must work together to prevent and better manage mental illness in black and minority ethnic groups.
Census figures also found that two-thirds of mental health inpatients are in mixed-sex wards.
Experts said the figures raised serious questions about mental health services.
The Count Me In Census 2007 found the number of inpatients in mental health wards has fallen from 33,785 in 2005 to 31,187 in 2007.
But the proportion of inpatients in independent mental health hospitals increased from 10% in 2005 to 14% in 2007.
The number of inpatients in organisations providing care for people with learning disabilities also fell from 4,609 to 4,153 inpatients.
Census figures revealed that 22% of people on mental health wards were from minority ethnic groups, compared with 21% in 2006 and 20% in 2005.
There were also differences in rates of admission between different ethnic groups and the proportion of patients admitted through the criminal justice system.
The report said that some ethnic groups have significantly higher rates of mental illness and there are numerous factors for differences in admission figures and routes to hospital.
The census is part of the government's five-year action plan Delivering Race Equality in Mental Health Care.
Anna Walker, chief executive of the Healthcare Commission, said: "We would like a dialogue with local agencies and with mental health and learning disability organisations that have high numbers of black and minority ethnic patients, such as those in London, Leeds and Birmingham.
"With their knowledge, we can begin to look at the problems within the communities and bring together local agencies to tackle the issues that cause some black and minority ethnic groups to have higher rates of mental illness."
She said there needed to be more focus on prevention and better access to services in the community to reduce the need for admission to hospital.
Professor Lord Patel of Bradford, chairman of the Mental Health Act Commission, said the census figures highlighted the importance of the government's Delivering Race Equality programme.
"I am deeply concerned about the continued high levels of admission detention suffered by some black groups especially the Black Other group - mostly black second and third generation young men.
"There are some very serious questions that need answering about the way these people are being treated."
Health minister Ivan Lewis said the government was committed to ensuring mental health services are sensitive to the need of different black and minority ethnic communities
"We can and must do more to ensure that the Delivering Race Equality programme is integral throughout the mental health system.
"I will be consulting representatives of the relevant communities, leaders, managers and frontline staff to identify next steps."
Paul Farmer, chief executive of Mind, said the figures painted a shocking picture of mixed sex wards and racial discrimination on the NHS.
"We must have a joined-up approach to tackle the widespread issues around the experience of black and ethnic minority communities in the mental health system."
Steve Shrubb, director of the NHS Confederation's Mental Health Network which represents the majority of mental health trusts, said tackling the over-representation of minority ethnic groups in mental health wards was the biggest challenge facing providers.
"Getting this right however requires the input of all agencies ? from GPs to the courts ? so that we can deliver what we know is the best practice of identifying problems early and then providing the most appropriate support."