The iconic radio show This American Life has retracted an episode broadcast in January about working conditions inside the Chinese factory that makes Apple's iPads, saying that some of the source material from playwright Mike Daisey was "partially fabricated".

The show, which aired on public radio the US, was withdrawn after its producer admitted that some of the details in Daisey's script were false, including his claims to have met workers poisoned on an iPhone assembly line by a chemical called n-hexane.

Ira Glass, the host and creative driving force behind This American Life, apologised for the error, saying he was "horrified to have let something like this onto public radio".

The retraction (PDF) follows assertions by the Chinese translator who helped Daisey, who disputed the story put forward the episode and in Daisey's one-man show, which is playing in New York.

In a statement, Glass said: "Daisey lied to me and to This American Life producer Brian Reed during the fact-checking we did on the story before it was broadcast. That doesn't excuse the fact that we never should have put this on the air. In the end, this was our mistake."

Daisey has been performing his play The Agony and Ecstasy of Steve Jobs, which is based on a visit he made to Shenzhen, China in 2010. He has made the transcript of the entire show available for download on his site (PDF). It includes claims that Foxconn employs 13-year-old line workers, a claim that the company has consistently denied.

This American Life, which is produced by Chicago Public Radio and distributed by Public Radio International, broadcast a monolgue by Daisey in January.

The podcast of the show quickly became the single most popular in This American Life's history, with 888,000 downloads and 206,000 streams. It led to a petition for better working conditions in the factories where Apple products are made. That petition eventually raised 250,000 electronic signatures and was delivered to Apple.

That, and the general tide of media coverage about conditions at the Foxconn factory, where a number of workers have committed suicide and long hours are commonplace, has led Apple to announce initiatives to improve and standardise working conditions.

Glass said Daisey was unhelpful when attempts were made to verify some of the details with his translator during the fact-checking process before the broadcas. Daisey said her was Anna – though in his monologue he calls her Cathy – and that her phone number no longer worked, and he had no way to reach her.

"At that point, we should've killed the story," Glass said in the press release. "But other things Daisey told us about Apple's operations in China checked out, and we saw no reason to doubt him. We didn't think that he was lying to us and to audiences about the details of his story. That was a mistake."

Doubts began to emerge when a US public radio reporter in China, Rob Schmitz, became suspicious of Daisey's statements. Schmitz, who is a correspondent for Marketplace, produced by American Public Media in Minnesota, tracked down the interpreter, Li Guifen, who uses the name Cathy Lee professionally. She disputed a number of Daisey's assertions.

In a statement on his blog on Friday, Daisey - whose show is now in New York - was unrepentant.

I stand by my work. My show is a theatrical piece whose goal is to create a human connection between our gorgeous devices and the brutal circumstances from which they emerge. It uses a combination of fact, memoir, and dramatic license to tell its story, and I believe it does so with integrity. Certainly, the comprehensive investigations undertaken by The New York Times and a number of labor rights groups to document conditions in electronics manufacturing would seem to bear this out.

What I do is not journalism. The tools of the theater are not the same as the tools of journalism. For this reason, I regret that I allowed THIS AMERICAN LIFE to air an excerpt from my monologue. THIS AMERICAN LIFE is essentially a journalistic ­- not a theatrical ­- enterprise, and as such it operates under a different set of rules and expectations. But this is my only regret. I am proud that my work seems to have sparked a growing storm of attention and concern over the often appalling conditions under which many of the high-tech products we love so much are assembled in China.

Glenn Fleishman, a Seattle-based writer for the Economist, said on Twitter that "I started writing about Daisey's Agony & Ecstasy for an Economist piece 15 months ago. While writing it, I had to stop when I realised the details didn't check out. He was in Shenzhen for a few days. He came back with an ocean of material." Fleishman's conclusion: "Implausible."

Some of the falsehoods in Daisey's monologue are small, such as how many factories he visited and how many workers he spoke to. But Schmitz had wondered how the workers who had been affected by an n-hexane accident far from Shenzhen could have met Daisey.

"I'm not going to say that I didn't take a few shortcuts in my passion to be heard," Daisey told Schmitz in an interview being broadcast later this week.

Guifen also disputes Daisey's claims to have met a man with a mangled hand who had worked on an iPad assembly line, and to have met 13-year-old workers on the line.

Glass said in his statement: "I suspect that many things that Mike Daisey claims to have experienced personally did not actually happen, but listeners can judge for themselves."

In February ABC's Nightline carried an episode in which it had unrestricted access to Foxconn's plant, at the same time that a team from the US Fair Labor Association, which Apple has recently joined, were conducting inspections. The FLA report is expected to be published within the next few months.

• This story has been edited to remove mistaken assertions that This American Life is made by NPR.