BACKGROUND: The collection of ethnicity information as part of cancer datasets is important for planning services and ensuring equal access, and for epidemiological studies. However, ethnicity has generally not been well recorded in cancer registries in the UK. The aim of this study was to determine the completeness of ethnicity coding in the Thames Cancer Registry (TCR) database and within the Hospital Episode Statistics (HES) data as held by the London Health Observatory, and to investigate factors associated with ethnicity being recorded. METHODS: Records for 111821 hospital admissions of London residents with a malignant cancer as a primary diagnosis between April 2002 and March 2003 and records for 25581 London residents diagnosed with cancer in 2002 were examined. Data on sex, age, cancer network of residence, deprivation, proportion of non-whites in the local authority population, and site of cancer were available. The proportion of patients in each group with a valid ethnicity code was calculated. In the TCR data proportions were also calculated adjusted for all other variables. RESULTS: Ethnicity was recorded for 90661 (81.1%) of the hospital admissions in the HES data and 5796 (22.7%) patients on the TCR database. Patients resident in areas with a higher proportion of non-white residents and the most deprived populations were more likely to have an ethnic code on the TCR database, though this pattern was not seen in the HES data. Adjustment did not materially affect the association between deprivation and ethnicity being recorded in the TCR data. CONCLUSION: There was a large difference in completeness of ethnicity between the data sources. In order to improve the level of recording in TCR data there needs to be better recording of ethnicity in sources TCR data collection staff have access to, or use of information from other sources e.g. electronic data feeds from hospitals or pathology laboratories, or HES data itself supplied directly to TCR. Efforts to collect ethnicity data should be encouraged in all healthcare settings. Future research should explore where the difficulties collecting ethnicity information lie, whether with patients, healthcare professionals or the recording procedure, and how such problems can be overcome.