In 1888, Brazil, with a mostly black and mixed race or mulatto population, was the last country in the Western Hemisphere to abolish slavery. During more than 300 years of slavery in the Americas, it was the largest importer of African slaves, bringing in seven times as many African slaves to the country, compared to the United States.

Another important difference was the extent of miscegenation or race mixture, resulting largely from a high sex ratio among its colonial settlers. In contrast to a family-based colonization in North America, Brazil's Portuguese settlers were primarily male. As a result, they often sought out African, indigenous and mulatto females as mates, and thus miscegenation or race mixture was common. Today, Brazilians often pride themselves on their history of miscegenation and continue to have rates of intermarriage that are far greater than those of the United States.

Miscegenation and intermarriage suggest fluid race relations and, unlike the United States or South Africa, there were no racially-specific laws or policies, such as on segregation or apartheid, throughout the twentieth century. For these reasons, Brazilians thought of their country as a "racial democracy" from as early as the 1930s until recent years. They believed that racism and racial discrimination were minimal or non-existent in Brazilian society in contrast to the other multiracial societies in the world. A relatively narrow view of discrimination previously recognized only explicit manifestations of racism or race-based laws as discriminatory, thus only countries like South Africa and the United States were seen as truly racist. Moreover, there was little formal discussion of race in Brazilian society, while other societies were thought to be obsessed with race and racial difference.

At the time of the abolition, Brazil's population was mostly black or mixed race until the 1930s, when Brazil encouraged and received a large number of European immigrants as it sought to find new sources of labour. In the context of the scientific racism of the time, which deemed a non-white population as problematic to its future development, Brazilian officials explicitly encouraged European immigration while blocking Chinese and African immigrants. The growing population of European origin was also expected to mix with the non-white, further "whitening" the Brazilian population.

The 2000 Census reveals that about 40 per cent of the national population is considered brown or mixed race, while 5 per cent are black and 54 per cent are white; less than 1 per cent are considered Asian or indigenous. These statistics are largely based on self-identity, and race or colour in Brazil is generally determined by appearance. Many persons classified as white, for example, may have African or indigenous ancestry, but their appearance defines their classification and treatment in society. Of course, there is ambiguity in classification for individuals who straddle the colour boundaries.

Today, most Brazilians of all colours acknowledge that there is racial prejudice and discrimination in the country. Based on the statistical analysis of censuses, surveys and other evidence, we know that racial inequality is high and that racial discrimination in the labour market and other spheres of Brazilian society is common. Non-whites are major victims of human rights abuses, including widespread police violence. On average, black and brown (mulatto or mixed race) Brazilians earn half of the income of the white population. Most notably, the middle class and the elite are almost entirely white, so that Brazil's well-known melting pot only exists among the working class and the poor. Non-white Brazilians were rarely found in the country's top universities, until affirmative action began in 2001.

Most discrimination in Brazil is subtle and includes slights, aggressions and numerous other informal practices, while consciously egregious and overt racism directed at particular individuals, especially in the form of racial insults, is more commonly recognized as racist. Even though Brazil's anti-racism laws target such incidents, which have long been considered un-Brazilian, subtle individual and institutional practices maintain and reproduce racial inequalities. Racialist ways of thinking, in which racial hierarchies are accepted as natural, are apparently as culturally embedded in Brazil as they are throughout the world. In societies like the United States, sociologists have also discovered how racism persists to reproduce racial inequalities, despite the end of race-based laws and the decline of explicit or egregious racism.There is plenty of statistical evidence showing that Brazil's racial inequality is due partly to ongoing discrimination, despite the historical absence of race-based laws or its apparently milder form of racism. The sociological analysis of mobility reveals that black and brown Brazilians, whose fathers were employed in particular occupational or class groups, are far less likely to experience upward mobility than whites of the same occupational or class origins. Also econometric analyses based on human capital models reveal that brown, and especially black Brazilians, earn about 20 to 25 per cent less than whites with the same background, when age, work experience, educational level, sex, region, class origin and labour market characteristics are considered. Yet another study shows that siblings of different skin colours, not an uncommon phenomenon in a country of miscegenation like Brazil, have different levels of education, where darker siblings are more likely to drop out of school at earlier ages than their white brothers or sisters. In that study, all factors besides discriminatory treatment on the basis of race (by teachers, parents, etc.) are strictly taken into account. The consistent findings on social mobility, the econometric analysis of income and the comparison of education levels in siblings of different skin colour demonstrate persistent racial discrimination.

These quantitative results should not be surprising, considering how race is talked about and portrayed in Brazilian society and given Brazil's earlier whitening ideology, which was based on the scientific racism of the time. Despite the historical and contemporary absence of race-based laws in Brazil and the population's historical denial of racism, Brazilians are not surprised when others make racist jokes or comments. Television and advertising portray Brazilian society as one that is almost entirely white; in reality, the middle class is almost entirely Caucasian, which reveals a glass ceiling that has disproportionately excluded non-whites. Middle-class status in Brazil is increasingly based on a university education, thus university admissions are the most appropriate place for race-conscious affirmative action. Miscegenation occurs almost entirely among the poor and working class, while the middle class, which touts miscegenation and opposes affirmative action, rarely experiences it. Marriages are mostly among persons of the same class -- for the middle class that generally means they occur among whites.

Largely as a result of insufficient anti-racist laws to redress persistent societal racism, and in response to black social movement in a recently democratized society, several universities and other public institutions in Brazil have begun to implement racial quotas. Coming on the heels of the World Conference against Racism, Racial Discrimination Xenophobia and Related Intolerance, held in Durban, South Africa in 2001, many of the leading universities are now mandated to admit a fixed percentage of non-white students. These policies represent a new stage in Brazil's effort to combat racial inequality; however, they are not without controversy as a backlash has recently begun. Detractors claim that class-based policies and universal reforms, such as improved public education, would have the same effect without having to define Brazilians on the basis of race or colour.

Defenders of racial quotas argue that race-conscious remedies, together with universal policies, are needed to significantly reduce Brazil's high levels of racial inequality, and that prior to affirmative action there was little concern for redressing racial inequality. The end of the "racial democracy" way of thinking, a national debate about race and racism, and the beginning of serious policy attempts to reduce racial inequality represent a new stage for Brazil.