Birmingham residents are moving out of the city - but they are being replaced by immigrants from overseas, new official figures show.
Thousands of local people are leaving to start new lives in other parts of the country.
But an even higher number are moving to the city from abroad.
The figures were released as the Government tore up decades of Labour dogma by calling for a debate on whether multiculturalism was good for Britain.
About 40,000 people left Birmingham for other parts of the country in the year to June 2005, while there were 32,000 new arrivals from across the UK.
This meant there was a net loss of about 8,000 people. But the city is still growing because of immigration from foreign countries.
When immigrants from overseas are included in the figures, the city's population grew by almost 2,000 people.
Yesterday's figures also showed the population of the West Midlands had shot up by 100,000 in ten years, and the region is now home to 5,365,000 people.
Across Britain as a whole, the population rose above 60 million for the first time, prompting a fresh debate about immigration.
The increase was partly caused by natural change, with the number of births exceeding the number of deaths.
But a spokesman for the Office for National Statistics said: "The main factor leading to the increase was net international migration, the difference between migration into and out of the UK."
In Birmingham's case, there were 15,200 immigrants from overseas, including 1,300 asylum seekers.
Another 5,800 people left Birmingham to go and live abroad, so the net figure for immigration was an increase of 9,400 residents.
MP Gisela Stuart (Lab Edgbaston) said Birmingham had always welcomed immigrants from overseas.
She said: "As other people have said, the great thing about Birmingham is that you are not born a Brummie - you choose to be a Brummie."
But she warned the Government risked "barking up the wrong tree" by launching an inquiry into divisions in society.
She said: "America works as a melting pot because it is not about an ethnic group, it is about an idea of what it means to be American.
"Britain is similar because it is about shared values, such as rule of law and liberty.
"We need to agree on those values. If the Government does that then it will be useful, but if it focuses on the things that divide us it would be a mistake.
"People ask what the Government should do for British Muslims, but if I turned around and asked what the Government was going to do for me as a British Catholic people would think I was mad."
Yesterday's statistics were released after Ministers admitted 50,000 workers from Eastern Europe had moved to the Midlands.
The figures showed many parts of the West Midlands had experienced population growth, as rural areas took in families moving out of cities such as Birmingham.
Between 1995 and 2005, the population of the West Midlands conurbation, including Birmingham, Coventry, Dudley, Sandwell, Solihull, Walsall and Wolverhampton, grew by 12,000.
But the biggest increase was in Warwickshire, where the population shot up by 40,000 to 533,000, an increase of eight per cent.