The company told its suppliers not to source products or labor from China's northwestern region of Xinjiang.
Beijing has been accused of human rights abuses in the predominantly Muslim area.
China has repeatedly denied those claims.
In a statement, Intel said it had been required to "ensure that its supply chain does not use any labor or source goods or services from the Xinjiang region" following restrictions imposed by "multiple governments".
The statement was branded 'absurd' by the Global Times - a nationalist tabloid which is published by the ruling Communist Party's official People's Daily.
It accused Intel of biting the hand that feeds it.
The chip maker earned 26% of its total revenues from China in 2020.
Intel is now backtracking over its statement.
It released another, Chinese-language statement, on its official WeChat and Weibo accounts, apologising to its Chinese customers, partners and the public.
Intel is just one of many multinational companies to have come under pressure as they aim to comply with Xinjiang-related trade sanctions while continuing to operate in China.
