The former Liverpool defender used the word while discussing the recent racism rows concerning John Terry and Luis Suarez.
The 56-year-old football pundit said: “There’s a lot of coloured players in all the major teams and there are lots of coloured players who are probably the best in the Premier League.”
But Hansen, who earns £40,000 per show, apologised today, saying: “I unreservedly apologise for any offence caused. This was never my intention and I deeply regret the use of the word.”
The BBC received 82 complaints over Hansen using the word and the phrase has sparked controversy on Twitter.
Arsenal and Tottenham midfielder Rohan Ricketts said: “Is this Alan Hansen guy taking the f****** piss??
“I’m not coloured??? He is part of the problem when using that word. We are BLACK Alan! Wtf [sic].”
Fans called Hansen “a complete fool”.
@gunnerblog tweeted: “Anyone else’s jaw hit the floor as Alan Hansen said racism wasn’t a problem in English football because of success of ‘coloured’ players?”
Some defended him, with one saying: “He’s not racist, he’s just old skool.”