A senior monitor of mental health patients' interests has warned of "a kind of apartheid" in the system.
David Rocky Bennett died after being restrained at a clinic
Lord Patel of Bradford, chairman of the Mental Health Act Commission, told the BBC that institutional racism in the service needed to be addressed.
He said it could be one reason why some black groups were 18 times more likely to be in psychiatric care.
But the government said improving black people's confidence in mental health services was "a top priority".
Lord Patel said it had to be established why there was an over-representation of black people in psychiatric care.
Otherwise, he told BBC Radio 4's Today programme: "We're going to have a situation where we'll have segregation.
"We'll have those that live on the margins of society, feeling more hopelessness than they do now.
"A kind of apartheid will happen in the next 10 to 20 years. It's going to get worse. We have to deal with it very strongly."
Professor Louis Appleby, the government's National Director of Mental Health, said: "We are working hard to win the trust and confidence of BME (black minority ethnic) communities, and community engagement is a key part of our action plan.
"This is key to better understanding the wider social factors that result in some communities experiencing a higher rate of mental illness.
"Our drive to improve care will remain a top priority until BME patients report better experiences of mental health services ."
Experts estimate black people are three to 10 times more likely to be diagnosed as schizophrenic and less likely to be diagnosed with depression.
They are also more likely to be detained under the Mental Health Act and to be given medication, rather than "talking" therapies.
David Rocky Bennett, a black mental health patient, died in 1998 after being restrained at a Norfolk clinic.
An inquiry into the incident concluded that institutional racism was "a festering abscess, a blot on the good name of the NHS".
Following this, the government pledged to "eradicate discrimination" in NHS mental health care.
Have you had personal experience of the mental health services?
In October 2006 I made a serious suicide attempt when I took over 100 paracetemol. I spent six days in hospital on a general ward. In the months since, I have only had one 30 minute appointment with a psychiatrist. I get the feeling that the NHS wishes I had been successful, as treating me would be more expensive than burying me.
Tim, Slough, Berks
I was in a mental institution in 1995 along with a black patient. He was having problems because he was kept inside for six months. He said he needed a lawyer because they wouldn't let him out. His girlfriend was coming every day to see him and he was to my belief well enough to be discharged from hospital.
It was a horrible. Not only are black people mistreated, but the whole system is a disappointment for white people too. There is more going on in wards than most people think. It's a terrible system for everyone, not just black patients.
I have worked for many years in mental health services. In my experience patients often refer to racism when there is conflict; however mental illness often creates distorted perceptions of events. In my experience, patients of all backgrounds are treated on a person to person basis. If a patient behaves in a challenging way, it is their behaviour which is responded to not their ethnic background.
It took a long while and litigation against a North London Trust before I realised that instead of being diagnosed with a complex version of PTSD, I was very subtly being labelled as personality disordered. I was able to challenge the diagnosis and the racist theories behind it because I am legally trained. I am now working to bring this behaviour to the attention of the General Medical Council and the authorities mentioned in your article.
Mental health services are culturally white Anglo-Saxon institutions. Any individual from a culture which contains more emotional self-expression and non-monotheistic religious beliefs is more likely to be diagnosed as abnormal due to this cultural ignorance. So when the government pledges to 'eradicate discrimination' they are doing the wrong thing - they need to treat black ethnic minorities with different cultures differently from Anglo-Saxons! The racism lies in treating everyone the same.
Alex Berkman, Edinburgh