The investigation was launched by the university after a medical student “blacked up” and wore an “oversized dildo” to impersonate a lecturer in a student play last February.
The annual charity production “Anaphylaxis”, was reported to police as a hate crime after several students of African heritage complained about the performance.
“Other lecturers too were made fun of,” the report reads. “There were racist, sexist and homophobic jokes and stereotype references.”
The script of the play was not approved by the university or the student union.
While police did not take any further action, the panel reported that 32 students involved in the play were suspended from clinical practice, while two of the complainants transferred to other medical schools.
Other students complained to the panel that there was a wider issue of segregation at the university, while women and BME staff said they found it hard to forge ahead in their careers.
Some said that local doctors and the NHS played a role in creating a “rugby culture”.
The investigation, led by King’s College London academic Professor Dinesh Bhugra, has made a series of recommendations to help the university avoid similar incidents.
It suggests Cardiff should increase diversity among its staff and implement regular diversity training on race, gender and sexual orientation.
The university should also make sure there are clear guidelines for complaints about racism and introduce training for medical students about unconscious bias and stereotyping, the report adds.
Bhugra said Cardiff University should be “commended” for launching the investigation.
“It was clear from our work that the situation has been the cause of a tremendous amount of stress amongst the student year group in particular,” he said.
“It should be an immediate priority for the university to bring forward plans for a programme that can build bridges amongst those closest to the incident.
“Whilst the University and School of Medicine did their best to deal with this incident in accordance with its established procedures our report does highlight a number of specific and overarching issues that the University needs to consider and address.”
Cardiff University’s vice chancellor Professor Colin Riordan added: “When the university asked Professor Bhugra to conduct a review we wanted a panel of independent experts to shine a light on equality and diversity at Cardiff University’s School of Medicine to ensure we are a place where all students and staff can thrive irrespective of their background.
“As a university we accept the report’s recommendations and are already undertaking a number of proactive measures to address them.
“Our message is clear: offensive stereotyping of any person, or group of persons, is not acceptable.”