Security camera footage of the November 5 incident, broadcast on US television last week, showed a police SWAT team bursting out of cupboards and stairwells with their guns drawn, storming early arrivals at Charleston's Stratford high school.
Semi-automatic handguns were trained on pupils, mostly black, who were ordered on to their knees with hands on their heads. Those resisting were handcuffed.
A voice then intoned over the school PA system: "All right, bring the dogs down." But the subsequent sweep by a drug-sniffing Czechoslovakian Shepherd, seen on the camera footage, found no drugs. Instead, school officials and the local police now face lawsuits filed on behalf of traumatised students and possible charges from South Carolina's attorney general and the Federal Bureau of Investigations amid inflamed racial tension.
Civil rights activist Jesse Jackson staged a rally near the school on Tuesday in protest over the perceived targeting of black students.
Two-thirds of the 107 teenagers rounded up were black, though they comprise only one in five of Stratford high's students.
The interrogation was colour-blind, insisted a spokeswoman for Berkeley County school district, who said head George McCrackin called in police after receiving multiple tip-offs of "drug activity".
"When the drug dog goes into backpacks and gym bags, they don't have any colour," said Pam Bailey. The raid targeted the time of day and wing of the school of suspected illicit activity, she added.
Mr McCrackin declined comment, but in a letter to parents last month he professed surprise that officers drew weapons.
The American Civil Liberties Union announced on Monday that it was suing the school and police on behalf of 20 black students, some of whom "had guns held to their head" during the raid, according to a spokeswoman.
A separate class action lawsuit, led by a law firm, is seeking unspecified damages for "assault, battery and false imprisonment".