The trust which runs hospitals in Brighton operates a culture of "bullying and discrimination", inspectors have said.
Brighton and Sussex University Hospitals NHS Trust has been placed into special measures after the Care Quality Commission highlighted a series of safety concerns and cultural issues.
The report found that discrimination against black and minority ethnic (BME) people was "rife", while some lesbian, gay, bi-sexual and transgender (LGBT) staff said they do not feel as though they are treated equally.
Safety issues highlighted by the report include:
The trust reported seven "never events" in 2015 - including four incidents where surgeons operated on the wrong part of a patient's body;
There were not enough staff to ensure patients were receiving safe care;
Patients were kept in surgical recovery rooms - usually just a temporary stop before being returned to a ward or intensive care unit - for up to three days;
Concerns were also raised over patients treated in a "cohort area", or a corridor, of the emergency department where they were examined without the use of privacy screens and were forced to discuss their medical history in close proximity of other patients;
Inspectors also highlighted particular issues with cleanliness and raised serious concerns about fire safety.
Professor Edward Baker, deputy chief inspector of hospitals for the CQC, said:
It is clear that the problems we have found on this inspection go right through Brighton and Sussex University Hospitals NHS Trust.
Dr Gillian Fairfield, interim chief executive at the trust, said: "It is clear from the CQC report that in many areas the trust has failed our patients and on behalf of the trust, I apologise unreservedly.
"The NHS as a whole is seeing growing demand for services and, like many other trusts across the country, this has caused us significant challenges which has affected the standard of the care we are providing our patients.
"These challenges have been made worse by the fact that our older buildings are not fit for purpose.
"It would be wrong for us to use these pressures and challenges as excuses, however, and we know we should and need to be doing better for our patients and staff.
"The failures identified by the CQC are completely unacceptable and over the last four months we have had, and we will continue to have, a relentless focus on addressing them.
"We are working to develop a culture of equality, fairness and accountability, with sustainable effective leadership, where patients are cared for in an appropriate environment."