Dolce and Gabbana goods have been pulled from Chinese e-commerce sites after the fashion house allegedly shared insulting adverts on social media.
The firm shared three promotional videos on Instagram showing a Chinese woman using chopsticks to eat pizza and other Italian food.
The Italian luxury fashion house's campaign has sparked outrage for "making fun of Chinese culture".
Chinese celebrities threatened to boycott a fashion event in Shanghai, which had been scheduled for Wednesday night, and the company finally called it off.
The designers apologised on Friday and said both accounts had been hacked.
Domenico Dolce and Stefano Gabbana said on a video shared on social media: "We have thought long and hard with great sadness about everything that has happened and what we have caused you in your country and we are very sorry."
Searches for Dolce And Gabbana turned up no items on major online retailers such as Alibaba’s Tmall and JD.com.
A duty-free shop at the Haikou Meilan airport on China’s Hainan island posted a photo of empty shelves on its social media account, saying it had pulled all Dolce And Gabbana products.
The shop wrote in another post that "Even if our power is small, we have to show our stance. We are proud of being Chinese".
Actress Zhang Ziyi, who starred in Crouching Tiger, Hidden Dragon, said the Italian brand had "disgraced itself".
An analyst said the bad publicity will have a lasting effect.
Shaun Rein, founder and managing director of China Market Research Group in Shanghai, said: "It’s the kiss of death for Dolce And Gabbana. I expect them to have a real tough time over the next six to 12 months."
Many in China called them racist and full of outdated stereotypes. The videos were previously deleted from the company’s account on Weibo, a Chinese version of Twitter.
Mr Rein said it is a big mistake when westerners come up with creative content but do not understand how the campaigns will be received by Chinese consumers.
He noted a trend of rising nationalism in China: "So if you, as a western brand, do anything that looks like you are mocking or making fun of Chinese culture, that’s a big no-no," he said.