Police recorded almost 1500 cases in the city last year, an increase of 13% on the year before and up almost 20% over three years.
Across the country racist incidents increased by 10% prompting calls for greater investment in resources to tackle racism.
The Scottish Government said it was disappointed with the figures which across the country had been falling in recent years.
The most common places for racist incidents were in the street, a shop or in a house, which together accounted for 3500 of the Scottish total of 5389.
The most common ethnic group to be recorded as a victim was Pakistani at 23% followed by white British at 22% of all cases.
In Edinburgh, cases increased over three years from 822 to 1017.
In Aberdeen incidents fell from 483 to 429 over the same period and Dundee also witnessed a drop from 215 to 154 over three years.
Roseanna Cunningham, community safety minister said she was concerned but acknowledged increases could be attributed to better awareness and willingness to report due to increased confidence in the police.
She said: "I am disappointed to see an increase in the number of racist incidents recorded by police. It is all the more disheartening given the downward trend observed in recent years.
"However, we know that this is not always due to an increased number of crimes taking place, but can instead be attributed to individuals and communities being better engaged with the police and having more confidence to report perpetrators of such crimes, and that when reporting a crime their complaint will be taken seriously."
Opposition politicians called for greater government efforts to combat racism.
Labour justice spokesman Lewis Macdonald MSP said: "We need to ensure that our schools and public services are alert to any signs of racism and that where it rears its ugly head, it is tackled forcefully.
"The police need to assure us all that we will see resources identified to help reverse this distressing rise."
Ms Cunningham said tougher action was being taken, adding: "There is no place for racism of any kind in Scotland."