The joke in question was made late Saturday night at the annual Inner Circle Show when Clinton and de Blasio engaged in an awkward back-and-forth at the comedy show.
"I just have to say thanks for the endorsement, Bill. Took you long enough," Clinton joked, referring to the delayed endorsement of her candidature by the New York mayor.
De Blasio responded, "Sorry Hillary, I was running on CP time," as the crowd was taken aback somewhat from the joke, CBS News reported.
CP Time, or CPT, is short for "Colored People's Time "- the stereotype that black people are always running late.
Actor Leslie Odom Jr, who plays Aaron Burr in 'Hamilton' and who was present during the show, said, "I don't like jokes like that, Bill."
However, the joke fell flat with some critics.
Slate magazine described the joke as "cringeworthy"; Raw Story online news website called it "painful"; and Town Hall news said, "It's only racist if Republicans do it."
De Blasio told CNN that "people are missing the point" of the joke.
"Every actor involved, including Hillary Clinton and Leslie Odom Jr, thought it was a joke on a different convention. That was the whole idea of it."
The mayor's office said the joke was not intended to offend. "Let's be clear, in an evening of satire, the only person this was meant to mock was the Mayor himself, period," de Blasio's spokesperson told CBS News.
"Certainly no one intended to offend anyone.
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