The civil liberties of Muslims have been eroded since the war on terror began, a Scottish spokesman has said.
Osama Saeed, of the Muslim Association of Great Britain, said hundreds of Muslims had been arrested under terror laws only to be released soon after.
He said threats such as Hogmanay bombings in Edinburgh had been "bogus".
His comments came after a House of Commons report recommended involving the Muslim community in the next stage of tackling terrorist in the UK.
'Clear perception'
Relations between ethnic communities have worsened since 11 September 2001, the Home Affairs Select Committee said.
It conducted a five-month inquiry into how the terrorism threat was affecting community relations.
The MPs' report said Asians were not being targeted by police, but there was a "clear perception" among Muslims that they were being stigmatised.
Mr Saeed said that anecdotal evidence showed a massive rise in "stop and search" of young Muslims.
He said: "It has got to be proper intelligence-led stop and search. It cannot just be randomly people on the street stopped and searched. That is a bogus way of conducting anti-terror operations."
In reality these threats have been bogus and have had a very bad effect on the Muslim community
Osama Saeed
"There has been a growing creep on civil liberties.
"About 700 Muslims have been arrested since the original terror laws were passed in 2000 under a blaze of publicity.
"And the vast majority have then been released within 14 days without charge, despite various threats of Hogmanay bombings in Edinburgh and Old Trafford football matches and gassings on the London underground.
"In reality these threats have been bogus and have had a very bad effect on the Muslim community."
'Verbal abuse'
Mr Saeed added that the issue of community relations was still being viewed in Scotland in the context of race.
He said: "Muslims identify themselves by religion rather than by race.
"We are getting reports from so many people about the Islamophobia they are suffering and it is being suffered by people of Anglo-Saxon stock.
"They have converted to Islam and because a lady has put on a headscarf she is being shunned in the street and facing verbal abuse."