Newspapers said Oliver was furious that the supermarket, which pays him 1.2 million pounds to front its advertising campaign, snubbed his invitation to appear on his television documentary Jamie's Fowl Dinners.
As part of the film, which examines the impact of factory farming on the welfare of poultry and the quality of the chicken people eat, Oliver invited representatives from the country's major supermarkets to take part in a recorded debate.
Only two supermarkets agreed to attend, and Oliver was said to be incensed by the snub from Sainsbury's.
"I am really upset," Oliver was quoted as saying in the British press. "Why didn't they come? What is there to hide? It is shocking that the people I work for did not turn up on the day. I do not know why. How dare they not?"
However on Friday, Sainsbury's said Oliver had written an open letter to all its staff, praising the company for its actions on the issue, saying it had the most to be proud of.
"Indeed I would not have continued working with Sainsbury's for so many years if I did not believe that you were showing real leadership," his letter said.
"I know that you have not seen the TV programme yet but I am confident that when it airs, viewers will clearly understand Sainsbury's leading position."
He goes on to say that reports of his criticism had been taken out of context and that positive comments about the company had not been reported.
The Guardian newspaper said the letter to staff had been written after 'a tense' phone conversation between Oliver and Sainsbury's chief executive Justin King.
However King told the paper there had been no pressure put on the chef to pen the apology.
"His independence of mind and independence of spirit and preparedness to stand up and be vocal is what makes him so valuable," King said. "When he says things about Sainsbury's people believe it is what he really thinks."
The letter comes after the supermarket ran full-page adverts on Thursday in national newspapers emphasising its stance on animal welfare issues with supportive quotes from Oliver, the RSPCA and Compassion in World Farming.
Oliver's documentary, to be aired on Channel 4, reports that 95 percent of chickens and two-thirds of eggs consumed are farmed intensively, and that most birds live in conditions many believe detract from their welfare and the quality of produce.