Speaking to presenter Graham Norton, the US pop superstar recounted collaborating with her daughter for her new album, marking their first duet.
"She doesn't want to be perceived as my daughter taking advantage of her privilege," Madonna said.
Leon performs under the stage name Lolahol and has intentionally distanced herself from her mother's fame to forge her own music career.
"She's been very standoffish and working at her own pace - and I respect that deeply.
"She's a great songwriter, and she has a much better voice than I do."
Madonna said her daughter has been "holding onto feelings" similar to resentment regarding her fame but eventually approached her so they could collaborate on a track.
"At the end of the day, she didn't ask for this. (Leon) has been through her adolescence struggling with those feelings for a long time.
"She came to me and said, 'Let's write a song together. I think it will be very healing experience'.
"You say exactly what you want to say, and I'll say exactly what I want to say. And I was like, 'Okay, you're on, let's do it' - I was so happy."
Madonna also spoke about the origins of her successful career.
"I've been very open and - I wouldn't say confessional - but talking about my feelings, my desires, my fears for decades," she said.
Madonna's album Confessions II is released on July 3.
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