Hardeep Singh Kohli accused Sally Morgan of racism before his eviction from the 'Celebrity Big Brother' house.
The 49-year-old presenter was left upset when the housmates decided to make a mini movie about doctors and patients when the psychic told him he was looking "too brown" and suggested putting talc on his face to make him look ill.
Hardeep - who was evicted on Friday (07.09.18) - left the room and told Dan Osborne he felt the comments had been "borderline racist", causing Sally to cry when she joined the discussion.
In scenes aired on Saturday (08.09.18), she said: "I have never, ever said anything racist. You implied it. I'm not going mad. I'm not having it. And then you come back and apologise like you don't know what you've done to me.
"It's absolutely dreadful why are you doing it to me? I have not got a racist bone in my body and you've implied it. I can't have it. You can't do it, I won't allow it."
The former 'One Show' presenter replied: "Fine, I owe you an apology it was ill-judged."
Sally later visited the diary room and accused her housemate of "picking on" her.
She said: "He can't accuse me of that. He's picking on me. It's just not right. I've tried so hard with this man and it's almost as if, when he's apologising, he's saying I don't understand racism.
"How dare he? I may not have a degree but I know what racism is."
The row came a day after Sally had offended Hardeep by forgetting what his turban was called and asking to use it for bandages.
The 'Celebrity Big Brother' live final takes place on Monday (10.09.18).