Michael Boxall and Bill Tuiloma Photo: PHOTOSPORT
The All Whites allege Michael Boxall was abused late in the first half of their game with captain Joe Bell raising the matter with the referee but no action was taken.
The All Whites then refused to take the field in the second half.
New Zealand Football chief executive Andrew Pragnell said several players heard the comment and he endorses the action taken by the team.
"We fully support the action of our players, who agreed collectively this course of action," he said.
NZ Football chief executive Andrew Pragnell. Photo: Photosport
"We never want to see a match abandoned but some issues are bigger than football and it is important to make a stand," he said.
"There is no room for racism in football."
The All Whites led 1-nil when the match was abandoned.
Pragnell wouldn't say what the alleged comment was.
"I won't got into the nature (of the comment) but it was really significant and in my view abhorent and has absolutely no place on the football field or anywhere... so not something I want to repeat."
Qatar coach Carlos Queiroz appeared to play down the incident.
"Apparently two players on the pitch they exchanged words... the New Zealand players decided to support their teammate just as our team decided to support our player," he told the Sky TV broadcast.
"The staff of New Zealand also supported the statement of the New Zealand player and we support our player and they decided to abandon the game... it's just an argument between two players and this is a new chapter in football which nobody can understand."
Sports Minister Grant Robertson agreed with the All Whites' decision to not return to the field.
"There is absolutely no place for racism in sport or anywhere else for that matter and I know that FIFA is wanting to crack down on these issues and I support the team in supporting their colleague and in standing up to racism. It is what we should all do," Roberston said.
Robertson also acknowledged the All Whites have limited opportunities for international matches which reflected the gravity of their decision.
"The fact that they didn't take the field in the second half given how few opportunities [they] get really does show how serious this incident must have been for them."
Just a few days ago in Barcelona FIFA president Gianni Infantino said matches must be stopped if there is racial abuse.
"It's very important not just to talk about racism and discrimination, but to take action in a decisive and convincing manner - zero tolerance."
He said it was imperative that match officials stop a match when players were subject to abuse.
"There is no football if there is racism! So let's stop the games," he said.
"The referees have this opportunity in FIFA competitions as we have this process for stopping the game, and actions have to be taken at every level, at national level as well. Everyone has to understand this and we will go, together, until the end."
-RNZ