In an exchange between the two contestants last night, which was not broadcast on the main programme nor E4's live streaming, Emily said to Charley: "Are you pushing it out, you nigger?"
In a statement, Channel 4 said it had no choice but to evict Conservative-supporting Parr following the racist remark, which was made at around 8.30pm last night.
It is the second racism row to engulf 'Big Brother' after the international storm around 'Celebrity Big Brother' earlier this year, in which Bollywood actress Shilpa Shetty was racially abused. Channel 4 made a public apology for that, which preceded the first show in the current series.
That row led to sponsor Carphone Warehouse pulling out and a new sponsor, Virgin Media, stepping into its shoes.
In response to Parr's comments, Virgin Media said in a statement that its sponsorship of 'Big Brother' will not be affected by the incident.
Virgin Media said that while it does not condone any form of racism, it was "completely satisfied that Channel 4 acted promptly in removing Emily from the Big Brother house and will ensure the current series does not promote any discriminatory behaviour."
In the latest incident, Channel 4 said that while neither Charley or Nicky Maxwell, who was also present, were offended by the comment, they "expressed shock that the comment was made". Emily, 19, immediately apologised for the comment, which she said was a joke, but acknowledged that she "should have been more careful with her words".
Following the incident, Channel 4 removed Parr from the 'Big Brother' household at 3.30am on the grounds she had broken the house rules governing contestant behaviour.
Parr was called to the diary room to be told she would have to leave the house immediately without contacting any of the other contestants. The rest of the housemates were told of her eviction at 9.30 this morning.
Angela Jain, commissioning editor for 'Big Brother' at Channel 4, said: "I think people watching the show tonight will agree that Emily spoke carelessly rather than maliciously -- certainly Charley and Nicky, the two housemates most directly involved in the conversation with her, seem to accept that she did.
"She understands why her involvement in 'Big Brother' has come to an end and she very much regrets what she said."
In defence of her remark, Parr said to Charley and Nicky: "I'm friendly with plenty of black people." She then repeated the offending word as the three housemates argued over whether it was a racially offensive comment.
In the 'Celebrity Big Brother' racism and bullying row Shetty was racially abused by Jade Goody, Danielle Lloyd and Jo O'Meara. In that incident Shetty was called "a Paki". In light of that, the programme makers said they would be taking a very strong line towards racially abusive language.
New rules were drawn up for 'Big Brother 8' and they were given to all contestants. They clearly state: "Big Brother will intervene and take appropriate action if housemates behave in a way that Big Brother considers is unacceptable.
"Unacceptable behaviour includes: behaving in a way that could cause serious offence to either their fellow housemates or members of the viewing public including serious offence based on the grounds of race. Housemates who act in a way that is seriously unacceptable will be evicted."
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