Protesters chanted slogans and waved banners during
the attorney general's speech in Atlanta
He was speaking in Atlanta in the wake of mass protests surrounding the shooting dead of unarmed black teenager Michael Brown by a white policeman. Mr Holder was speaking at the Ebenezer Baptist Church in Atlanta where Martin Luther King preached.
President Obama has requested funds to improve training and provide body cameras for the police. The shooting of Mr Brown in August in Ferguson, Missouri, has reignited tension over relations between young African-Americans and the police. Most of Ferguson's police are white, while the town's residents are mainly black.
A grand jury's decision last week not to charge police officer Darren Wilson over Mr Brown's death sparked violence across the US. A mass walkout was held on Monday as employees stopped work and students left classes.
Mr Holder was in Atlanta to meet law enforcement officials and community leaders at the request of President Obama. In a speech during a forum titled "The Community Speaks", Mr Holder said that the police cannot be seen as an "occupying force". The issue, he said, was larger than just the police in the community.
"Our overall system of justice must be strengthened and it must be made more fair," he said.
Mr Holder said he would update department of justice guidance on racial profiling by federal law enforcement.
"This will institute rigorous new standards and robust safeguards to help end racial profiling once and for all," he said, to applause and cheering from the audience. However his speech was disrupted by protesters who shouted slogans and waved placards calling for "an end to police murder".
Racial profiling involves police using a person's ethnicity as a factor in deciding whether to take action.
Post-Ferguson plan
- more appropriate use of military equipment by police
- 50,000 body cameras (pictured above) to record interactions
- task force to build a "sustained conversation" across the US
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