A Nazi-themed Facebook group that called for the “execution” of Jews and African Americans has led to the expulsion of five Boulder, Colorado, high school students in an unusual case of “alt-right” hate speech spreading to teens in a liberal city.

About 15 students participated in a “4th Reich’s Official Group Chat” on Facebook, according to a Boulder police report, which said members discussed “killing all Jews and [N-words]” and encouraged each other to “recruit more members so they can complete their ‘mission’.”

Members wrote messages championing “WHITE POWER!”, posted pictures of guns, called a firearm a “[N-word] BLASTER”, used derogatory terms for gay people, joked about “rape memes”, declared that they “must lynch the [N-words]”, and mocked Mexicans, copies of the group’s chats showed.

The controversy culminated in expulsions at Boulder Preparatory high school but comes at a time when the alt-right movement – known for white supremacist views and its overtly racist ideology – has gained traction during the divisive US presidential race.

Democratic candidate Hillary Clinton has accused GOP nominee Donald Trump of “taking hate mainstream”, and the Republican candidate’s campaign has galvanized far-right groups associated with the Ku Klux Klan and fringe online communities that celebrate “white identity”.

Some have argued that Trump’s charged rhetoric – with frequent speeches demeaning and stereotyping Mexicans, African Americans, Muslims and other minorities – has fueled a racist backlash and created a platform for alt-right groups and white working-class people in rural America who feel disenfranchised and ignored in mainstream politics.

The Colorado case, however, suggests that the hateful and violent speech has also made its way into wealthier white urban communities, in this case in an ultra-liberal city known for its “hippy culture” and tolerance.

“It was a shock to the community,” said Scott Levin, regional director of the Anti-Defamation League. “It isn’t as if there is any identifiable group [in Boulder] that is advocating this. There’s a lot of hateful rhetoric going on in this country right now, and that has just empowered some teenagers.”

There’s a lot of hateful rhetoric going on in this country right now, and that has just empowered some teenagers Scott Levin, Anti-Defamation League

The Facebook group, first reported by the local Daily Camera newspaper, was discovered after one of its leaders allegedly committed suicide, reportedly to “show his allegiance to the [Nazi] party and the killing of Jewish people”, a police report said. Officers were also investigating reports that a Boulder Prep high school student was being “threatened and harassed” by classmates.

Participants gave themselves Nazi-themed nicknames, including the Fuhrer, Gruppenfuhrer and Sturmbannführer. They wrote of “the final solution” and the goal to “eradicate all lessers [sic]”, with some writing, “Let’s have fun killing jews” and “You can hang Jews on trees, shoot them right in the knees. Gas as many as you please.”

The students come from a number of local schools. Officials from Boulder Prep, a charter school, told police they had expelled five participants. Most of the students’ names were redacted in the report, except for three who are 18 years old.

Police ultimately decided not to press charges after determining that “there is no evidence or documentation to support there being any credible threat to any students”, officers wrote.

Boulder Prep did not respond to an inquiry, and officials with the Boulder Valley school district, which oversees a number of schools included in the investigation, said in a statement that it “administered appropriate responsive action with the students involved” and declined to comment further.

At least one student attempted to play down the seriousness of the group, with an officer saying “he informed me that the whole thing was ‘funny’ and he would not actually ever do any of those things”, the report said.

One mother was “visibly shaken by the conduct of her own son”, the report added.

It is unclear how long the Facebook group was running, whether other users ever reported the nature of group or whether the group was known to the social media company. Under Facebook’s community standards, “hate speech” is banned, including content that “attacks people” based on race, ethnicity, gender or other factors.

Facebook representatives did not immediately respond to a request for comment.

Christina Hughes, a core member of Black Lives Matter 5280, a local Colorado chapter, noted that black students make up a tiny fraction of the Boulder Prep student body and urged school officials to proactively educate students about prejudice.

“What we would really like to see is for the district to step up and do more … in implementing an anti-racism curriculum and programs,” she said. “We want to see systems put into place that eradicate these mindsets altogether.”

• The US National Suicide Prevention Hotline is 1-800-273-8255. In the UK, the Samaritans can be contacted on 116 123 or by emailing jo@samaritans.org. In Australia the crisis support service Lifeline is on 13 11 14. Hotlines in other countries can be found here