Commenting on the slip-up, Khairy Jamaluddin said the organizers has discharged the publisher of the 29 Southeast Asian (SEA) Games souvenir book containing the misprinted Indonesian flag, affectionately dubbed the Red-and-White.
Malaysian Youth and Sports Minister Khairy Jamaluddin met his Indonesian counterpart Imam Nahrawi to personally apologize.
"We don't want our neighbouring country, Indonesia, to feel hurt, so we need to take measures to ensure this does not recur in future".
Indonesia's president expressed concern on Sunday after Malaysia's Southeast Asian Games organisers mistakenly published the Indonesian flag upside-down in a commemorative magazine, prompting anger amongst fans.
Pictures of the upside down Indonesian flag began circulating online shortly after the guidebook was handed out at the opening of the games in Kuala Lumpur on Saturday.
In 2009, Indonesia's tourism minister demanded an explanation from Malaysia after a furore over a television advertisement with the theme "Enigmatic Malaysia" featured a Balinese dance.
Brunei has also had its flag misused after organisers used the flag of the Brunei military rather than the country when awarding synchronised swimmers Jacqueline Lim and Nur Hafizah Ahmad their medals, according to a report from Agence France Presse.
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"The incident is deeply regrettable".
Khairy said the mistake was "unintentional and it happened due to our carelessness". "We are also waiting for a direct apology from the government of Malaysia".
"Friendship is the greatest legacy in sports, but a mistake in presenting a national identity is not justified", he said.
Despite this, Home Affairs Minister Tjahjo Kumolo will continue to send an official letter to Malaysia to question the intention behind the printing mishap.
A year ago at the Rio Olympics, China complained bitterly that the flag used at medal ceremonies had its small gold stars pointing at the wrong angle.
At the 2012 Olympics, North Korea's women's footballers refused to play, delaying the start of their game with Colombia, when they were shown next to the South Korean flag on a stadium screen.