Suzanne and Rowan Hatch of Wellington in New Zealand, discovered the condom in the Happy Meal of their granddaughter Maia Whitaker on Tuesday night, the Dominion Post newspaper reported.
Mr Hatch said his wife looked in the small sports bag which came with the meal and was aghast to find a green Durex condom and its packet.
"I was pretty horrified really, the fact my granddaughter was going to look in the bag and find this thing. It would be difficult to explain, she's only seven."
Staff at the McDonald's swapped the meal for a hamburger and a pencil case.
McDonald's spokeswoman Joanna Redfern-Hardisty said inquiries had revealed that, because of the popularity of the previous Happy Meal gift which had sold out at that outlet, pre-packaged sports bags were substituted as children's gifts.
One was left unsealed for display purposes and "somehow" it had ended up with the customer.
