The report finds there are 58 full-time independent schools in Britain catering for about 2 per cent of Muslim children, most at primary level and with the majority from a South-Asian background.
But out of the 7,000 state schools with a religious affiliation, not one is Muslim, despite numerous applications to the Government.
"It is difficult to avoid the suspicion that anti-Muslim prejudice has played a part in the rejections," says the report. Unless there are a number of Muslim schools in the state sector, the inevitable message will be that Islam is less worthy of respect and public esteem than Christianity and Judaism, it adds.
The report discovered lower achievement in the 15 local education authorities with the highest number of Bangladeshi and Pakistani residents. Standards had risen - but so had those of other groups.
The report also recommends that: * the Home Office commission a "swift review" of Section 11 funding for English language teaching in schools to see which methods worked best; * the Teacher Training Agency and Muslim organisations should encourage more Muslims to train as teachers; * more Muslims should be on governing bodies.
Islamophobia, a challenge to us all, The Runnymede Trust, 133 Aldersgate Street, London EC1A 4JA, Pounds 9.50