A school board which said it would refuse meals to children more than 1p in debt has agreed to review its payments system.
Ysgol Dyffryn Nantlle, in Gwynedd, Wales, had told parents the decision was due to a deficit in the school meals budget.
The cook at the school had been told "not to give food to any child" if debts had not been cleared.
It sparked outrage among some parents, with one father who owed 36p saying he was "absolutely fuming".
The decision meant pupils were at risk of going unfed because of their families' financial troubles.
Anti-poverty campaigner Marcus Rashford joined the fight for a U-turn on the policy.
On Twitter, he wrote: “Has the pandemic not taught us anything?”
“Has the pandemic not taught us anything?”
He added: “For many children, lunch is the only meal they’ll get.”
Gwynedd council has now apologised for concern caused by the letter's wording.
The school's governing body also called the online payment system "inefficient".
A letter, sent by strategic head teacher Neil Foden, had said all debts over £10 would be transferred to the local authority who would get in touch with the households.
Families who owed £10 or more would be referred to the local authority
Those with debts over 1p would receive a message from the school asking the adult to "clear its debts and credit the system" by next Friday, 19 November.
The school's chair of governors said the procedures set out in the letter will be reviewed.
Sara Lloyd Evans said she understood the council advised Mr Foden on how debts should be managed, but the governors would discuss the guidance provided by the local authority to "ensure there are no communication difficulties in future".
The warning was issued in a letter sent by Neil Foden, the strategic head of Ysgol Dyffryn Nantlle in Penygroes, Gwynedd.
Daily Post Wales)
She said that governors supported tackling the issue of child poverty after receiving reports from teachers storing snacks in their classroom for pupils who went to school without breakfast.
"In view of the media attention to this issue we would suggest that having this discussion NOW would be timely," she wrote.
"We would invite the minister for education and the Welsh language to meet with our governing body to discuss this matter."
The governing body said it is committed to tackling child poverty.
The letter sent to families of the school children
Has your child been denied free school meals? Let us know: email@example.com
Currently, she said, no automated messages were sent to parents informing them of their debts, it was not possible to top up the account with cash and there was a minimum bank transfer payment of £10.
She said this online payment system was "inefficient" and governors would work with the council to improve it.
Gwynedd council apologised for "the worry and concern" caused by the wording of the letter parents received from the school.
"The welfare of children and young people is always our priority, and we will always ensure that no child across the county will face a day without lunch at school. This should be made clear in any letter to parents from the county's schools when discussing school dinners."
It added that anyone "experiencing difficulty" paying for school meals should get in touch.