Kjellberg who has more than 57 million subscribers, says in a 95-second YouTube post that he made the comment "in the heat of the moment."
The 27-year-old Swede says using the word" while live-streaming playing the online game Playerunknown Battlegrounds, "was not okay."
Kjellberg said Wednesday he was "really sorry" if he "offended, hurt or disappointed anyone with all of this."
The online star, who rose to fame by posting videos of himself playing and commenting about video games, earlier had to defend himself over anti-Semitic allegations.
He didn't immediately respond to an email seeking comment.
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