"As per the directions of holy Akal Takht (the highest temporal seat of Sikhs), I have decided to withdraw the movie 'Nanak Shah Fakir' from all the theaters worldwide forthwith," producer Harvinder Singh Sikka said in a statement.
He said he had great regard for the Akal Takht and "couldn't afford to go against the directives of the top religious head Gurbachan Singh".
Sikka said the Akal Takht head had asked him to make certain changes in the movie before it was screened and he would do the same.
The objection to the Punjabi film, based on the life of Guru Nanak, was first raised by radical outfit Dal Khalsa.
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Dal Khalsa spokesperson Kanwar Pal Singh said Sikka "surrendered" before the Akal Takht.
The outfit had submitted a memorandum to the Akal Takht head on April 6 urging him to direct the producer to withdraw the film.
Earlier on April 10, Shiromani Gurudwara Prabandhak Committee (SGPC) President Avtar Singh Makkar, in a letter to Prime Minister Narendra Modi and Information and Broadcasting Minister Arun Jaitley, had urged them to impose a ban on the controversial film.