Farah, who beat Vernon to 10,000m gold at the European Championships in Zurich last summer, alleged his team-mate suggested he did not deserve the title as he was not European.
Farah made the claims when he was questioned on Friday about a Twitter spat the pair had earlier in the week.
The 31-year-old, who was born in Mogadishu in Somalia before moving to Britain as a child, has apologised for the social media row, but admitted their past contributed to his frustrations boiling over.
Vernon initially admitted making the comments in Zurich, but insisted they were intended as “a joke” among a group of people “having a laugh” and apologised if they were taken out of context.
But, after reading in full Farah’s remarks, he labelled them “an outrageous misrepresentation” of their “tongue-in-cheek” chat and claimed they were designed to portray him in a bad light.
Farah is in Birmingham ahead of a tilt at an indoor world best time over two miles at today’s Sainsbury’s Indoor Grand Prix, but the build-up to the meeting has now been overshadowed.
Asked about the pair’s history, Farah said: “We were sitting down together and there were a number of staff and athletes there too. One comment he made, which I didn’t really like, was to say that he should have won the gold.
“I was like, ‘What, the gold should have been given to you?’. And I was like, because he was the only European guy?
“You can’t say something like that. I was kind of biting my tongue at the time.
“I don’t know what he meant, but at that point it hurt me. But I moved on.
“That was private.”
Vernon reacted furiously to the accusations.
He said in an interview with BBC Radio Solent: “It’s an outrageous misrepresentation of the chat we had at the Europeans. It’s annoyed me that he’s come out and said this, it really has.
“He has played the cheap shot. He has played the card. I don’t know what I can do.
“If that one remark that I did make in jest was so terrible all I can do is apologise, I didn’t mean any offence by it.”