How do i increase my reputation?

Take missions from stations in Empire space, sell system survey data to stations in Empire space trade goods to and from stations in Empire space, I started in Federation space so most of my cash has been earned in that region and I'm allied with the Federation faction just through doing the tasks I've listed but you need to be sure you're in Empire space before you do any of that.
 
Check the missions with the hand symbol - for some the text states reputation gain instead of credits as a reward.

Also check that the minor faction issuing that mission is aligned with the major faction (Empire) - you can check this in the right panel.


Update: You can also take any mission from the minor factions to increase reputation, the ones with the hand symbol just seem to speed the process up.
When finishing the mission you'll get the info about the improved reputation by a small blue up-arrow.
 
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I just became allied with the Empire today, I've been running a lot of transport missions. I fly between 3 stations usually, industrial-agricultural-hightech-industrial, and take all the missions that I know I can get the commodities for from one of those stations.
I usually have 5-15 different missions on all the time when I'm doing that run.

Or did you mean military rank? I just recently got my first military mission, just before I got the allied status with them. I'm not really sure what triggered it, it might be combination of reputation, combat rating and ship rating... Because I've been flying cargo ships for a while and never saw any military missions, and then I hopped into a cobra with A-ranked modules and bam, I got a navy mission, even if my combat rating is only a Novice.
 
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