The group of undergrads had gathered at Kent Ridge Hall in the National University of Singapore (NUS) to drink and celebrate the end of Rag Day.
One of them then started telling racist jokes while the others laughed. All the while, they were filming themselves.
When the five-minute video was posted online, it immediately created an uproar.
The undergrad who told the racist jokes was later identified as a 20-year-old first-year student from the Singapore Institute of Management (SIM).
A police spokesman said a report had been lodged and they are investigating the matter. Both SIM and NUS said they are looking at possible disciplinary actions to be taken.