How to deal with racial insensitivity in an academic environment?
In your question, However, he realized it and walked away immediately. and But after few hours, he came back and he was conversing with me like nothing happened
indicate to me that he felt sorry and didn't know exactly how to deal with it.
Professors are also human. They make the same mistakes others do.
I would suggest you to talk to him in person about this incident politely and seriously. Tell him that you are upset with the remarks he made earlier and explain to him why. Don't be emotional.
Whether or not he will apologize is up to him. If he doesn't offer apology to you after you talk to him, then talk to his superiors if you want the apology.
I guess it depends on the personalities to a certain extent but it's always good to talk to the person, to weed out any misunderstandings and/or give that person a chance to explain him/her-self.
If I were in your shoes, I would start by asking the person if you can have a 1-to-1 meeting, during which I would take up:
- what you heard him/her say
- that it bothers you for reasons: A,B,C ...
- and that you wonder if he/she meant what was said, or if it was untimely and insensitive joke.
Given the offense is really bothering you, I personally wouldn't advocate for keeping quite and letting it go. Insensitivity aside, if your boss has racially-demeaning or insulting opinions, then it's probably not the kind of place you want to work at anyways. It would be better to know that...
I have to stress that even though my suggestion might seem confrontational, with right tone and choice of words I am certain it would not appear so to the professor in question. For reference, check out http://en.wikipedia.org/wiki/Nonviolent_Communication
You say you have two options - to ask or to ignore. Actually you have many options - infinitely many. One of these would be to get to know your professor better. This I recommend.
There are compusive disorders that impell people to say shocking things. Tourette's syndrome is an extreme case, but there are others. Sometimes we just do stupid things.Some people find it terribly hard to apologise. We humans are very complex. Nobody knows what it feels like to live in inside another's skin.