The study of 4,600 primary and secondary students was undertaken at public schools with higher indigenous and migrant populations.

Nearly half of the students surveyed - 43 per cent - reported seeing teachers direct racially-motivated discrimination at other students.

The Speak Out Against Racism survey - led by the Australian National University and Western Sydney University - revealed indigenous Australian students and those with ethnic minority backgrounds suffered the most, with 40 per cent reporting racial discrimination by their classmates.

Among the same group, 20 per cent also reported racism from teachers.

A joint statement from opposition education spokeswoman Tanya Plibersek and opposition multicultural affairs spokesperson Andrew Giles said the report was a call to action, as "our schools reflect our society".

"It is unacceptable that as many as one-in-three school-age children have been abused, threatened and discriminated against simply because of who they are, where they may have come from, the faith they profess or how they dress," it said.

Sixty per cent of students said they had witnessed another student suffering racial discrimination from their peers.

However, 60 per cent also said they intervened most of the time to stop the bullying or support the victim. Less than eight per cent said they joined in, but 12 per cent said they did nothing.

"Racism and racial discrimination profoundly limit opportunities and have potential for serious lifelong consequences. The findings from SOAR show the extent of this burden for many Australian children and present an important call to action," lead researcher and ANU associate professor Naomi Priest said in a statement.

The results of the survey will be used to develop a program that encourages and equips students and staff to intervene in racist bullying situations.

Australian Associated Press