Anti-terror laws brought in after the 11 September attacks should be repealed because they unfairly targeted Muslims, a committee of MPs has heard.
Mr Khan spoke for the Forum Against Islamaphobia and Racism
The laws were "ineffective" and led to the Muslim community being stigmatised, human rights lawyer Imran Khan told the home affairs committee.
"The whole of the Muslim community is now tarnished with the word terrorism," Mr Khan said.
The committee is looking at the impact of terror on community relations.
The Anti-Terrorism Crime and Security Act 2001 (ATSCA) gives the police more powers to hold and question people suspected of terrorist activities.
It also allow foreign terrorist suspects to be detained indefinitely.
There were already enough laws to fight terror, said Mr Khan who spoke for the Forum Against Racism and Islamaphobia.
Mr Khan said: "The most symbolic thing the government can do is say this piece of legislation is not working. It's creating problems for a particular community so let's take it away."
He also claimed the legislation did more harm than good by alienating Muslim communities from the authorities that rely on them to provide intelligence.
In a submission to the committee, the forum said Home Office figures showed that since 11 September 2001, 609 people were arrested under the Terrorism Act 2000.
Some 99 people were charged under the Act and 15 people convicted.
"With an exception of the few, nearly all those arrested under the anti-terrorism legislation have been Muslims and most of those convicted have been non-Muslim."
A quarter of the people surveyed by the forum in preparing for its submission to the committee said these statistics "proved Muslims were being criminalised under the legislation".
Gangs of youths
One in five of the 400 people quizzed said "continuous arrests" across the county have exaggerated the threat of terrorism and led to the Muslim community being perceived as the "enemy within".
This perception had led to increased incidents of Islamaphobia and racism against Muslims which manifested itself in the form of vandalism of mosques, Muslim graves and homes, the committee heard.
Ramesh Kallidai from the Hindu Forum of Britain said Hindus too had been the target of more physical attacks and racist comments since 11 September.
This was because those attacking them did not differentiate between Hindus and Muslims.
Temples had been daubed with graffiti and prayers interrupted: "We have gangs of youths coming in and terrorising the worshippers," Mr Kallidai said.
He gave one example of a temple in Ealing, west London, being disturbed during celebrations for the Hindu festival of lights, Diwali.
"Two vandals went into a temple on Ealing Road. They shouted that everybody should convert to Christianity. Then they went into the altar and shook the deity which fell to the floor and broke."
But earlier the committee heard that Muslims were wrong to blame all their problems on Western society.
Dr Don Horrocks head of public affairs at the Evangelical Alliance also suggested the media was awash with pro-Muslim programmes.