The 31-year-old (pictured above) was said to have been a victim of the "climate of unrecognised discrimination amongst middle management".
Ms Martins, from Wandsworth, south-west London, applied for a job as a trainee buyer after nearly five years' experience as an assistant fashion buyer.
However, the court was told that this background had been dismissed by the M&S interviewers as being with a "relatively indistinguished fashion outlet": Ms Martins had been working for Woolworth's.
Ms Martins' barrister, Ian MacDonald QC, said she had complained to an industrial tribunal which ruled there had been racial discrimination, awarding her pounds 3,000 for injury to her feelings and giving her leave to apply for compensation for other losses.
The panel said she did not get the job because of her ethnic origin and that although the company had taken steps to counter the perception of it as "a white middle class organisation", it had had little impact on the staff's ethnic mix. There was said to be have been a "climate of unrecognised discrimination amongst middle management".
In May last year an Employment Appeal Tribunal ruled that the initial tribunal's findings had been "perverse" and said M&S had taken reasonable steps to get rid of racial discrimination.
The store says Ms Martins, who is trying to overturn the EAT's decision, was not chosen for the job because of her poor performance at the interview.
The hearing was adjourned until tomorrow.