An "institutionally racist" child protection system is trampling on First Nations children, according to a scathing report released by South Australia's Commissioner for Aboriginal Children and Young People.

In the Holding on to Our Future report tabled in SA Parliament on Wednesday, Commissioner April Lawrie found in a single calendar year, one-in-two Aboriginal children are reported at least once to child protection authorities, whilst one-in-ten are placed in out-of-home care (OOHC).

"The Aboriginal community will no longer tolerate this cost to continue to be at the expense of our children and future generations," Commissioner Lawrie said.

Furthermore, without meaningful change, SA will see 140 out of every 1000 Aboriginal children placed in state care by 2031, the report said. Currently, Aboriginal children and young people constitute approximately 5.5 per cent of the population of children under the age of 18, but 37.4 per cent of all children in OOHC.

The report has made 48 findings and 32 recommendations to reduce the number of First Nations children in the child protection system.

It found a need to involve Aboriginal people in decisions about Aboriginal children; unnecessary removals were disproportionate and only growing, causing long-term harm; and systemic racism and cultural bias in child removal and placement decisions.

Ms Lawrie said, in the majority of cases she examined, the underlying issues that led to families' contact with the child protection service system "have not been about the intentional harm of children".

"They are characterised by problems associated with poverty and intergenerational trauma, mental illness, domestic and family violence, homelessness and substance use," the Commissioner said in the report.

"In responding to these issues, removals should be a last resort, but often problems have been allowed to escalate to a point where removals become the first step taken when intervening with these families."

Ms Lawrie said there needed to be an acknowledgment that a system had been built, "where the only option to respond to problems associated with disadvantage is to funnel families into child protection."

"This has to change," she said.

"The child protection service system is not equipped to meet the cultural needs of Aboriginal people."

The report found there was not enough funding for early intervention services for vulnerable Indigenous children and the Department for Child Protection's (DCP) cultural responsiveness was "severely lacking". It recommended working the DCP work in partnership with the Aboriginal community to improve outcomes for Aboriginal children in SA.

"The government has been told before that investment in early intervention and support is insufficient," Ms Lawrie said.

"This investment must elevate the capacity for Aboriginal Community Controlled Organisations (ACCOs) to be able to provide this early support and move away from the DCP being the only responder.

"Failure to act means that struggling, vulnerable families will continue to encounter the child protection service system at increasing rates, and that Aboriginal children being removed from their families will mean the government will pay the cost one way or another, for matters that are preventable."

The report also recommended laws surrounding child protection be amended to include the Child Placement Principle, which the SA government - along with all other states and territories - had agreed to implement and ensures the removal of Aboriginal children from their families is a measure of last resort.

The report found for all Aboriginal children in OOHC, only 38 per cent are being cared for by their Aboriginal kin or a member of the Aboriginal community.

"Aboriginal people have had enough of watching an institutionally racist system that does not adequately apply the Principle or know how to consider safety within the broader context of a child's family, community and culture," Ms Lawrie said.

The ABC reported SA Minister for Child Protection, Katrine Hildyard said the government would take time to consider the report's recommendations before acting accordingly.

"What is clear is that further effort that privileges the voices of Aboriginal families and communities is required," the minister said in a statement to parliament.