Jeff Varner, who is appearing on Survivor: Game Changers, made the revelation about his team-mate Zeke Smith on Wednesday's episode.
Varner told the show's presenter and his team-mates: "There is deception here," before turning to Smith and asking: "Why haven't you told anyone that you're transgender?"
He has since apologised on Twitter.
Several other contestants quickly defended Smith after Varner's comments, telling the former news anchor his actions were "so wrong" and that he "didn't have to do that".
Smith had previously shared his history with Varner privately but had not intended to reveal he was trans on the show.
In an article for The Hollywood Reporter published after the episode aired, Smith criticised Varner and said he was "not wild about [viewers] knowing that I'm trans".
He wrote: "In calling me deceptive, Varner invoked one of the most odious stereotypes of transgender people, a stereotype that is often used as an excuse for violence and even murder.
"Varner is saying that I'm not really a man and that simply living as my authentic self is a nefarious trick.
"In reality, by being Zeke the dude, I am being my most honest self - as is every other transgender person going about their daily lives."
Smith added that he doesn't believe Varner, who is gay, did it because he hates trans people, and praised his Survivor team-mates for the way they reacted.
"I think he hoped others would believe that trans people are fraudulent. What's great is that nobody bought it.
"It's important people see he lost that fight. The message should be clear that hate will always lose."
In a Twitter message posted after the show aired, Varner offered his "deepest most heart-felt apologies to Zeke Smith".
He wrote: "I was wrong and make no excuses for it. I own responsibility in what is the worst decision of my life."
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A contestant on a US TV show has been outed as being transgender by one of his fellow competitors.