The incident took place on Friday during the latter stages of Liverpool's tie against Juventus at the Next Generation Trophy in Salzburg.
The teenager informed the Liverpool coaching personnel about the abuse. Staff then followed protocol by withdrawing their players from the field of play.
After consulting with their Juventus counterparts, the match was abandoned. Juventus identified the player responsible for the remarks who made an apology to his opponent and was suspended by his club for the remainder of the tournament.
Liverpool began their subsequent game against Ecuador's Independiente del Valle by taking the knee alongside their opponents.
A Liverpool spokesman said: “We can confirm that a member of our under-16s team was racially abused by an opponent while playing in the Next Generation youth tournament in Austria."
“The individual responsible was identified immediately and removed from the competition as a result of the swift intervention of our own players and staff, tournament organizers and opposition management, who have also taken additional disciplinary measures inclusive of education."
“We would like to place on record our appreciation for the prompt actions taken by all involved. This applies most of all to the player subjected to the attack, who showed remarkable maturity in following established protocols, including leaving the pitch, in order to report the matter as soon as it occurred. He is receiving the full support of the club."
“We would also reiterate that our condemnation of all forms of racist abuse remains unequivocal and absolute.”