Walmart has recalled donkey meat sold at some of its China stores after tests showed the meat contained DNA from other animals.
According to Reuters, Walmart said it had set up an investigation team to look into the incident, will strengthen its food safety rules and will take legal action against the supplier.
The Shandong Food and Drug Administration earlier said the product contained fox meat.
The person in charge at the supplier factory has been detained, the report said.
Walmart will reimburse customers who bought the "Five Spice" donkey meat.
"We are deeply sorry for this whole affair," Walmart's China president and CEO, Greg Foran, said. "It is a deep lesson (for us) that we need to continue to increase investment in supplier management."
Donkey meat is popular in some parts of China, although it only accounts for a tiny fraction of overall meat consumption.
Walmart came under fire in China last year after officials in the city of Nanning accused it of using expired eggs in baked goods, the Wall Street Journal reported.
A Walmart spokeswoman said that the issue was resolved, without elaborating.