A story about a Chinese boy written by David Williams will be removed from one of his children's books following criticism that it contained "harmful stereotypes".
Brian Wong, Who Was Never, Ever Wrong will not appear in a new edition of The World's Worst Children when it is released next year.
Podcaster Georgie Ma raised the issue of it "normalising jokes on minorities from a young age".
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Publishers met with Ms Ma to discuss the matter and agreed to take it out of the book, which contains stories about 10 characters, including Nigel Nit-Boy, Grubby Gertrude and Bertha the Blubberer.
The original sold 450,000 copies in the UK following publication in 2016, and two sequels and other spin-offs have been released since.
"In consultation with our author and illustrator [Tony Ross] we can confirm that a new story will be written to replace 'Brian Wong' in future editions of The World's Worst Children," a statement from publisher HarperCollins Children's said.
"The update will be scheduled at the next reprint as part of an ongoing commitment to regularly reviewing content."
Ms Ma was critical of the illustrations of the character Brian Wong, which she believes could result in bullying.
"'Wong' and 'wrong' are two words that are commonly used in playgrounds to pick on someone if their surname is Wong," Ms Ma told The Bookseller.
"Even just the way Brian has been illustrated. He wears glasses, he looks like a nerd, he's got small eyes... they're all harmful stereotypes."
Walliams was previously involved in controversial use of blackface in Little Britain, the show he co-wrote with Matt Lucas.
The pair apologised, saying they "regret that we played characters of other races".