The affected products comprise both whole birds and chicken pieces, which are sold under the brand names Moy Park, Tesco, Waitrose and Morrisons. Up to 23 tonnes of affected chicken has been distributed across the UK.
Under EU law it is illegal to use nitrofurans in food producing animals. Some studies have shown that it could increase people's risk of getting cancer.
Nitrofurans are synthetic broad-spectrum antibiotics often used for their antibacterial properties in food-producing animals. The European Union banned the use of nitrofurans in food animal production in 1995 with the United States following suit in 2002.
The EU also implemented a stricter food import inspection policy following the discovery of nitrofuran residues in poultry, fish and shrimp imports.
This particular case came to light during routine tests, carried out by the Department of Agriculture and Rural Development's (DARD) Veterinary Science Division, as part of the UK's surveillance programme for veterinary medicines.
The chickens came from a Northern Ireland farm. The chicken was supplied to supermarkets across the UK by Moy Park, a food processing company in Northern Ireland.
The FSA says that Moy Park is now cooperating with DARD veterinary officials to establish the source of the contamination. The company has instigated a product recall and has contacted all the retailers it supplied.
The health risk from eating an affected chicken is low because concerns relate to long-term exposure to these drugs. In addition, the discovery of excessive or illegal antibiotic traces is unusual within the UK's poultry industry.
For example, a National Surveillance Scheme analysis of 35,399 animal product samples in the United Kingdom last year showed that just 89 contained detectable residues of veterinary medicinal products at concentrations above the relevant maximum residue limit or action level.
This compares to the 102 positives in nearly 35,800 analyses in 2002. Overall, the results indicate that authorised uses of veterinary medicinal products did not result in residues of human health concern.
"The 2003 results of surveillance for residues of veterinary medicines and certain other substances in foods produced in the UK were broadly in line with those of last year," said Dorothy Craig, acting chairwoman of the Veterinary Residues Committee (VRC) .
"They demonstrate that consumers can remain confident that the food they buy for themselves and their families is safe, taking account of the incidence and concentrations of the residues detected."
However, the discovery of a traces of a banned antibiotic is something that the FSA is determined to look into, and something that the UK poultry industry will undoubtely be keen to resolve.