WeTransfer said the clause was initially added to "include the possibility of using AI to improve content moderation" and to identify harmful content.
It appears to have been changed in late June or early July, according to snapshots taken on the Internet Archive.
The terms had said WeTransfer could use content for purposes "including to improve performance of machine learning models that enhance our content moderation process".
It also included the right for WeTransfer to "reproduce, distribute, modify," or "publicly display" files uploaded to the service.
Some users on social media interpreted this as WeTransfer giving itself the right to share or sell the files uploaded by users to AI companies.
People working in the creative industries, including an illustrator and an actor, posted on X to say they used the service to send work and were considering changing to alternative providers.
WeTransfer said it updated the clause on Tuesday, "as we've seen this passage may have caused confusion for our customers."
The clause in the terms of service now says: "You hereby grant us a royalty-free license to use your Content for the purposes of operating, developing, and improving the Service, all in accordance with our Privacy & Cookie Policy."
The rival file-sharing platform Dropbox also had to clarify it was not using files uploaded to its service to train AI models, after social media outcry in December 2023.