Update - 9.23pm: A son of the late Martin McGuinness has called for an end to "displays of hate" at loyalist bonfires after a coffin bearing a picture of his father was placed on one in Belfast.
Emmett McGuinness said he had been raised by his parents never to hate anyone or anything.
Mr McGuinness endorsed the comments of Sinn Féin's Stormont leader Michelle O'Neill on Twitter hours after the image of the mocked-up coffin appeared in the media.
He wrote: "I am very thankful that I was raised by parent's never to hate anyone or anything. @moneillsf is right, the annual display of hate must end."
I am very thankful that I was raised by parent's never to hate anyone or anything. @moneillsf is right, the annual display of hate must end.— Emmett McGuinness (@emmettmcg18) July 11, 2017
Sinn Féin chairman Declan Kearney branded those behind the display as "hatemongers".
"This display is a particularly sickening manifestation of the hate we have witnessed across the North over recent days, including some of the most vile sectarian and racist abuse," he said.
"This is the action of hatemongers intent on indoctrinating bigotry and perpetuating sectarian divisions in our society.
"Their behaviour stands in stark contrast to the work that Martin McGuinness did to build reconciliation and reach out the hand of friendship.
"It is also grossly insulting to the McGuinness family which still mourns the loss of a much loved father, brother and grandfather.
"It is simply unacceptable that unionist political parties still refuse to condemn this kind of hate crime."
Earlier: A black coffin adorned with the face of the late Sinn Féin deputy first minister Martin McGuinness has been attached to a bonfire off the Castlereagh Road in east Belfast.
Police are also investigating a racist banner referencing Celtic striker Scott Sinclair hung on another bonfire in the east of the city.
Fires will be lit in loyalist areas across the North tonight to usher in the main date in the Protestant loyal order parading season - the "Twelfth of July".
In recent years, bonfire builders have faced criticism after items linked to the nationalist/republican tradition - such as Irish flags and posters and effigies of high-profile politicians - have been placed on the top of some of the fires and torched.
Sinn Féin's Stormont leader Michelle O'Neill called for an end to what she described as an "annual display of hate".
She said: "Once again, we have witnessed bonfires across the North being festooned with stolen Sinn Féin election posters, Irish national flags and other emblems.
"The theft and burning of posters from any party as well as flags, effigies and other symbols is not culture, it is a hate crime.
"I have written to the PSNI Chief Constable (George Hamilton) and told him it should be treated as such by the PSNI and appropriate steps taken.
"There is also a responsibility on unionist political parties and the loyal orders to show some leadership on this issue and end this annual display of hate once and for all."
John Finucane, a Sinn Féin candidate in the general election, said he contacted police after learning that some of his campaign posters had been attached to a bonfire.
The solicitor, son of loyalist murder victim Pat Finucane, tweeted a picture of the bonfire on Tuesday morning.
"My posters have been placed on top of a bonfire," he wrote.
"I have reported this hate crime & theft to PSNI to allow them to act urgently."
My posters have been placed on top of a bonfire. I have reported this hate crime & theft to PSNI to allow them to act urgently. pic.twitter.com/Qu9WuD0SeZ— John Finucane (@johnfinucane) July 11, 2017
A PSNI spokeswoman said: "We take hate crime very seriously and actively investigate all incidents reported to us. Hate crime is wrong on all levels and the PSNI will do everything it can to ensure that everyone, from whatever background, can live free from prejudice, fear and discrimination."
Democratic Unionist leader Arlene Foster claimed there was a campaign to "demonise" the bonfires.
"Bonfires on the Eleventh Night have long been part of the unionist culture," she said.
"Those who have waged a campaign of demonisation against such celebrations should dial down the rhetoric. To those who build bonfires, I urge them to not play into the hands of those who want to demonise the culture. They should be respectful of their neighbours. Endangering property and lives should not be a concern for residents on the Eleventh Night. These should be events that all the family can enjoy. We will work constructively with communities to achieve this."
Mrs Foster said she wants Northern Ireland to move forward to a place where the Orange culture is supported and respected by all.
"I do not want any culture to threaten or dominate any other," she said.
"A shared society in Northern Ireland must have room for all but without elevating or promoting one section of society above another.
"Despite the image sometimes portrayed, it is not politics that dominates the Twelfth July, however. It is the families who come together as they have done for generations. It is the acquaintances that are refreshed in the field or on the street. It is the celebration of civil and religious liberty and the centrality of faith to the Orange Institution which are far more important.
"I would hope that everyone will enjoy the Twelfth celebrations, both those who do so every year, and perhaps others who will explore this part of our culture and heritage for the first time.
"Hopefully we can all help build a Northern Ireland where there is respect, tolerance and support for all our cultures and traditions, celebrated equally with one another."
Homes have been boarded up at a number of huge bonfire sites there also amid concerns around safety and risk to property.
Some of the unregulated structures have been erected in built-up areas near homes and other properties.
Contractors in Belfast spent most of Tuesday morning boarding up windows at a number of the sites, including Ravenscroft Avenue and Cregagh in the east of the city and Lanark Way in the north.
The traditional "Eleventh Night" fires mark the start of commemorations of Protestant King William of Orange's victory over Catholic King James II at the Battle of the Boyne in Ireland in 1690.
The towering bonfires, most built with stacks of wooden pallets, will draw thousands of onlookers - but they are often the source of controversy.
This year has been no different, with Belfast City Council securing a court order to prevent further construction on four bonfires in the east of the city amid safety concerns. Masked loyalists appeared to defy that order at one of the sites on Monday.
Last year, a number of terraced homes next to the Hopewell Square bonfire in Belfast's Shankill Road were badly damaged when a blaze broke out on the roofs. It was caused by hot embers blown on the wind.
Advocates of the bonfires portray them as a family-friendly, spectacular celebration of loyalist/Protestant culture.
Their detractors claim they are potentially dangerous, environmentally damaging, magnets for anti-social behaviour and alienating to nationalists.