When Maria Demeova sat down on her bus to work and glanced at newspaper headlines about the "blonde angel" child taken from a Roma couple in Greece, her heart sank. "Though the facts of the case haven't been established, there is a fear that the whole Roma community across Europe is being put on trial for something which might or might not have happened in one family," she says.

Now a teaching assistant at a Sheffield secondary school, 28-year-old Demeova, who is Roma, says she grew up with daily prejudice and discrimination, which persists in her native Slovakia.

"I was segregated at school, kept away from the non-Roma children, but I worked hard, I got a good degree."

In the UK, she supports Europe Roma International. "We spend a lot of time countering stereotypes that are totally wrong – that none of us have blue eyes or fair hair, that we don't want to work, that we're all musicians. Roma are very worried about this child case and media coverage across Europe. Even in the UK, Roma are talking about it, asking, will people be afraid of us all now?"

The 10 to 12 million Roma people in Europe already make up one of the largest, most disadvantaged minorities on the continent. They frequently live in makeshift camps with no water or electricity, face routine evictions, become victims of violence, are discriminated against over jobs, and find their children segregated at school.

Rights groups are now, however, concerned about a knock-on effect across Europe of an anti-Roma witch hunt gathering pace following the frenzy over the case of Maria, the fair-haired child found in the Roma camp near Farsala, Greece.

DNA tests have shown that Maria is not related to the couple raising her and the man and woman have been held on charges of abduction and document fraud while an investigation continues.

Days after this discovery, two fair-haired Roma children in Ireland, a girl aged seven, and a two-year-old boy , were taken from their parents by police on the basis that they looked different from their relatives. But after DNA tests they were returned to their families.

Martin Collins, of the Traveller and Roma centre Pavee Point, says he blames a kind of "hysteria" sweeping the continent since the Greece case. He says he fears the start of racial profiling, with authorities going into Roma communities and forcibly removing children in the absence of any welfare concerns.

There are also fears of the public taking matters into their own hands. In Serbia last weekend there were reports of skinheads entering a Roma area and trying to take a boy aged two from his family because he was "not as dark as his parents". The parents called the police.

The Roma community, suffering stereotyping and prejudice over perceived criminality, was alreadybeen a target.

Earlier this year some people in Dortmund, Germany, called the police to report that adults of Roma appearance were taking children to a flat and leaving without them. When the police investigated, they realised the flat was the venue for a children's birthday party.

In Italy, in 2007, three weeks after the murder of an Italian woman by a Romanian immigrant sparked an intense anti-Roma outcry, a 15-month-old girl was snatched from her mother's parked car in the small town of Cernusco Lombardone, near Milan, while her mother went into a supermarket. One of the first places the police looked, according to reports, was a nearby Gypsy camp. They found nothing there because soon afterwards the baby was discovered at the home of a mentally unstable Italian woman in the area.

Dezideriu Gergely, executive director of the European Roma Rights Centre (ERRC) in Budapest, says: "If a crime has been committed in Greece, and it's still by no means clear, those who committed it should be treated as individuals, not as representatives of their ethnicity.

"The Irish cases show how easily authorities can act on assumptions or perceptions. This type of action is racial profiling, targeting a group following a concept of guilty until proven otherwise. Since the Greek case [in Roma communities], the assumption that their children don't belong to their families is causing a lot of anxiety.

"There is a misconception, a prejudice and stereotype, which is that Roma are thieves and therefore they steal babies, and on the basis of this stereotype people expect authorities to act. I've never seen a case like this before."

Campaigners warn that European countries' administrations have for years fostered widespread violations of the rights of Roma children. Roma children are statistically much more likely than others to be put into state care, forced into segregated school classes to be kept apart from the majority populations, and forcibly evicted from their homes.

A 2011 report by the ERRC found "significant over-representation" of Roma children in state care institutions in Bulgaria, the Czech Republic, Hungary, Italy, Romania and Slovakia. The researchers said children were often removed due to prejudice and racism.

While poverty was not officially an acceptable criterion for removing children to a home, in the case of Roma the authorities were blaming families for not being able to improve their social and living conditions; they took children away on the basis of poverty.

The placing of Roma children who do not have any unusual educational needs or mental disability into special needs schools continues in countries such as the Czech Republic.

The European court of human rights has ruled against several countries, including Hungary, Greece, the Czech Republic and Croatia, for segregating Roma schoolchildren.

"You'd hope educating children in special schools simply because of their ethnicity would be unthinkable in Europe in 2013," said Fotis Filippou, of Amnesty International, after one ruling.

Gabriela Hrabanova, the former head of the Czech government's Roma office, and now policy coordinator for the European Roma Grassroots Organisations Network, in Brussels, warns that speculation around the Greek case may fuel the rhetoric of extreme-right political groups in the runup to European elections.

She says: "There's a real fear of increased stigmatisation against Roma as a whole because it will feed the racist rhetoric of hard-right parties rising in Europe. Already politicians are using this case. In the runup to elections this is particularly worrying, because this discourse will have a negative effect on politicians deciding public policy."

She says the case feeds into stereotypes embodied in storytelling by adults, especially the old saying: "Behave, or the Gypsies will take you."

Despite recent moves by bodies such as the European commission and Council of Europe to highlight and combat discrimination against Roma, deprivation and segregation of many their communities in Europe has increased. Meanwhile, the anti-Roma political discourse, once the preserve of the far right, has moved more and more into the mainstream.

Last month the EU told France it could face sanctions over the treatment of its Roma community after the Socialist interior minister said most should be deported and France was "not here to welcome these populations". Amnesty International reported 10,000 Roma evicted from makeshift camps in France in the first half of this year.

François Hollande, the French president, is embroiled in a row over Leonarda, a Roma girl, aged 15, who was ordered off a school bus in France and deported to Kosovo. The Czech Republic has seen a wave of anti-Roma street demonstrations in recent months.

In Greece, in an atmosphere of rightwing extremism and growing racism, authorities have targeted the 300,000-strong Roma community, human rights groups say. The raid on the Farsala Roma camp, where Maria was found, is a part of that drive, they say. "Roma have been persecuted [here] for as long as anyone can remember but they have been particularly scapegoated recently with camps being raided supposedly in search of weapons and drugs," says Petros Constantinou, who runs Greece's leading anti-racist, anti-fascist movement, Keerfa.

The government, he adds, "is determined to assume the far-right mantle" in law and order. "And it has seen that attacks on Roma work." He says the neo-Nazi Golden Dawn party has seen its popularity rise on the back of "progroms" against the Roma. Like other human rights defenders he thinks the media's "blonde angel" discovery has served to reinforce racist stereotypes.

Nikos Voultsos, who also works at Keerfa, says: "From what we know, there have been raids on camps nationwide following the discovery of the little girl. The case has been used to stigmatise an entire community."