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New York-based Sesame Workshop said in a statement that its own inquiry concluded that the claim of underage sexual conduct was unsubstantiated, and that puppeteer Kevin Clash has denied any wrongdoing and called the allegation "false and defamatory."
But the company said Clash, 52, was disciplined after an internal investigation showed he "exercised poor judgment and violated company policy regarding Internet usage."
The Sesame Workshop statement said the puppeteer was "taking actions to protect his reputation" and that Sesame Workshop has "granted him a leave of absence to do so."
Neither Clash nor his personal publicist was immediately available for comment.
CNN quoted a statement from Clash acknowledging a relationship with his accuser but denying he had sexual contact with a minor.
"I am a gay man. I have never been ashamed of this or tried to hide it," it quoted him as saying. "I had a relationship with the accuser, it was between two consenting adults, and I am deeply saddened that he is characterizing it as something other than what it was."
The statement went on to say, "I'm taking a break from Sesame Workshop to deal with this false and defamatory allegation."
Sesame Workshop said the matter came to its attention when it received a communication in June from accuser, now aged 23, alleging that he had a relationship with Clash beginning when he was 16 years old.
"We took the allegation very seriously and took immediate action," the company said, adding that it met with the accuser twice and had "repeated communications with him." The company said it also discussed the matter with Clash, who denied the allegations.
A spokeswoman for the show said she did not know whether law enforcement authorities were looking into the allegations.
Clash officially joined the "Sesame Street" cast in 1984, assuming the Elmo role that year.
Elmo's character had debuted on the show in 1979, and though Clash was the third performer to animate the child-like shaggy red monster, Sesame Workshop credits him with turning Elmo into the international sensation he became.
For now, producers promised that Elmo would remain on the show despite the absence of Clash, saying "Elmo is bigger than any one person and will continue to be an integral part of 'Sesame Street'."