The notice, which had triggered an online debate, said staff at the west Tokyo branch "would refuse entry to people deemed improper," citing poor hygiene and homelessness as examples.
But the global fast food giant said today that following complaints, the sign had been replaced, and now made no mention of homelessness.
"Even though the purpose of the notice was for other customers to be able to feel comfortable in the outlet, some of the words it used were inappropriate, and we apologise for that," a company spokesman said.
The spokesman added that all other outlets in the country had been instructed to ensure notices are free from discriminatory language.
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Despite the relative wealth of Japan and its traditional emphasis on family networks, the homeless are not an uncommon sight in Japanese cities.
Unlike in many western nations where the homeless tend to be young, the men and women who live on Japan's streets are overwhelmingly older people.
Officially, a total of 8,265 people were considered homeless in Japan as of January this year, the welfare ministry said, down 13.7 per cent from a year earlier.