Both Tuareg rebels and the army in Mali have committed abuses against civilians because of their ethnic origins, a Human Rights Watch report says.
The Malian army has been advancing towards the last Tuareg-held town.
Soldiers are accused of torturing Tuaregs, while the rebels are said to have rounded up and beating members of rival, darker-skinned groups.
French-led forces this year ousted Islamist militants, allied to the Tuaregs, from most of northern Mali.
The Tuaregs of northern Mali, who are mostly light-skinned, have a long history of seeking autonomy from the rest of the country, saying they have been discriminated against by the government in Bamako.
BBC International Development Correspondent Mark Doyle says the struggle, by the mainly black-African army to re-take Kidal, held by the Tuaregs in the far north, has been key in reigniting racial tensions, along with plans to hold elections next month.
The Human Rights Watch report said the Malian army seriously abused a number of ethnic Tuareg villagers, threatening to kill them, beating them and using racial slurs.
It also said about 100 black Africans were arrested in Kidal, with many being robbed, beaten or expelled towards the south.
Mali's Foreign Minister Tieman Coulibaly has condemned the Tuareg action.
"In Kidal, black people are openly attacked," he told The Associated Press. "That is new. Before, racism was latent, a bit creeping, but now it is unashamed."
The MNLA rebels have denied the charges.
"Civilians across the ethnic divide have already suffered enough," said Corinne Dufka from Human Rights Watch.
"The recent abuses by both sides and renewed fighting around Kidal underscores the urgent need for Malian soldiers and rebel combatants to respect the laws of war, minimise civilian harm and ensure the humane treatment of detainees," she said.
The Islamist groups abandoned the towns they controlled ahead of the French-led advance, which began in January.
But the MNLA, which is fighting for autonomy for northern Mali, has refused to leave Kidal, while the army has been reluctant to attack the town in the Sahara desert.
The UN is due to deploy a 12,600-strong peacekeeping force before planned elections in July, which will incorporate thousands of West African troops already in the country in support of the French intervention.