The singer and songwriter teamed with the rapper on 'Beautiful Pain' for his 'The Marshall Mathers LP 2' album, but will donate all the money she receives from the song to the Los Angeles Gay and Lesbian Center, after there was uproar this week about Eminem using gay slurs on the record.
Sia - who is bisexual - argued that Eminem's Slim Shady character represents the ''worst and darkest bile of America'' and the man behind him is in no way homophobic.
She told blogger D.J. Keo Nozari: ''I know personally that he is not homophobic, but a performance artist. I would never work with someone I believed to be homophobic. I respect that he can be misinterpreted in the worst way by the ignorami (sic), and that scares me, but I respect him as an artist and person.''
Eminem has also addressed his use of the word ''faggot'' - a slur usually aimed at gay men - this week, saying he doesn't mean it in its usual context.
He said: ''That word, those kind of words, when I came up battle-rapping or whatever, I never really equated those words ... [to actually mean 'homosexual']. It was more like calling someone a bitch or a punk or a**hole.''
He also slapped a jet-lagged Taylor Hawkins.
The acclaimed performer had just cancelled touring due to a battle with cancer.