Strauss was talking to fellow commentator Nick Knight during the MCC's bicentenary 'Union of legends' match which featured some of the greatest players of the game, including Sachin Tendulkar, Shane Warne and Brian Lara.
Strauss, who clashed with Pietersen during their playing days for England, thought he was off air when he made the offensive 'absolute c***' comment about Pietersen, who was batting for the ROW team, during an advertisement break for viewers in Britain.
But, it was picked up by Fox Sports online viewers in Australia, for whom coverage was not interrupted.
After realising the embarrassing gaffe, Strauss issued an apology on air, saying, "I apologise unreservedly, particularly to Kevin Pietersen. I am mortified and profusely sorry."
Sky also issued its own apology. "Comments were made during a break of play which were heard overseas. We apologise for the language used," the broadcaster tweeted.
Pietersen was suspended for one Test in 2012 after sending derogatory text messages about Strauss to South African cricketers engaged in a series in England. He was finally sacked earlier this year after a series of destabilizing controversies.
Strauss, twice an Ashes-winning captain, retired following England's 0-2 defeat in that series. He has written later in his autobiography 'Driving Ambition' that he never entirely trusted Pietersen again after that incident.
"For me, he had crossed the line. He seemed to be at best destabilizing and at worst undermining our carefully cultivated team environment," Strauss wrote in his autobiography.