There needs to be a "fundamental shift" towards a more inclusive and consultative way of working with Aboriginal and Torres Strait Islander young people in Australia, says Mission Australia.

The call comes after a report found they have higher levels of concern than their non-Indigenous peers about issues such as bullying, emotional abuse, depression, drugs, alcohol, gambling and suicide.

The report - which drew on the results of Mission Australia's 2015 Youth Survey - also found that while the majority of Indigenous young people feel positive overall about their lives, 10 per cent of Aboriginal and Torres Strait Islander young men and five per cent of women indicated their happiness was "zero" out of 10. The figures compare with only one per cent of non-Aboriginal and Torres Strait Islander respondents.

Other findings showed Indigenous young people were more than twice as likely to have spent time away from home in the past three years because they felt they couldn’t return. They were also likely to have stayed away more frequently and for longer.

Catherine Yeomans, Mission Australia CEO, said the report provided "further evidence that Indigenous young people are facing more serious challenges than their non-Indigenous peers".

"As a society, Australia has a moral, social and economic duty to support all young people to reach their potential. And sadly, this report shows we are failing miserably, with too many Aboriginal and Torres Strait Islander young people falling through the cracks. This is not a sustainable way for us to proceed as a nation and to me it suggests a divided society."

She called for an "urgent rethink" to ensure society is "working alongside Aboriginal and Torres Strait Islander young people to overcome the barriers in front of them – barriers that must sometimes seem insurmountable - leading to these concerning levels of despair".

"We need a more inclusive and consultative way of delivering services with Aboriginal and Torres Strait Islander young people. These approaches must be long-term, with a sustained commitment. Too many effective responses have been ad hoc, cut short and left unsupported."

The responses of some 1,162 Indigenous young people were captured in the 2015 Youth Survey which recorded in total the responses of 18,727 young Australians.