Don't take my word for it:
People of colour discuss the word "nigger" and its negative and positive connotations and use. Scroll down, it's a good discussion.
From: Queens College:
"I'm a twenty year old African American female. During my lifetime, I've heard many stereotypical names used to describe African Americans, but one that disturbs me the most is the name 'nigger.' Nigger is more than a word. It is like a weapon used against African Americans. The word nigger first appeared in the 1700s, and it was derived by the white man to imply a creature so degraded that they must represent a lower level of humanity. This was the white man's way of justifying slavery. But the word nigger can represent characteristics found in all people and races."