Tory vice-chair Ben Bradley said he had made “a seriously defamatory statement” and accepted that the claim was “wholly untrue and false”.
He had been threatened with libel action by Mr Corbyn's lawyers.
Mr Corbyn has said he met a Czechoslovakian diplomat who was later expelled as a spy in the 1980s, but has categorically denied ever being an intelligence asset.
A spokeswoman for the Labour leader said: “We are pleased Ben Bradley has admitted what he said was entirely untrue and apologised, and that charities in Mansfield will benefit.
“Following the botched smear campaign against Jeremy, this case shows we are not going to let dangerous lies go unchallenged.”