Puneet Sablok said he would remove Hitler's name and the Nazi swastika from billboards and the menu. He had said the restaurant's name — "Hitler's Cross" — and symbols were only meant to attract attention.
Sablok made the decision after meeting with members of Mumbai's small Jewish community.
"Once they told me how upset they were with the name, I decided to change it," he said. "I don't want to do business by hurting people."
Sablok said he had not yet decided on a new name.
Hitler's Cross opened five days ago and serves pizza, salad and pastries in Navi Mumbai, a suburb of Mumbai, the city formerly known as Bombay until 1995 .
On Thursday, Mumbai's Jewish community welcomed Sablok's decision to rename his restaurant.
"He realized he made a mistake and listened to reason," said Elijah Jacob, a community leader. "Some people have wrong conceptions of history and he realized it was not appropriate."
Mumbai's Jews had called the theme of the restaurant offensive and demanded a name change. There are about 5,500 Jews in India, with about 4,500 of them living in Mumbai.
"I never wanted to hurt people's feelings," said Sablok.
Some Indians regard Hitler as just another historical figure and have little knowledge about the Holocaust, in which 6 million European Jews were systematically killed during World War II.
The swastika symbol, which was appropriated by the Nazis, was originally an ancient Hindu symbol and it is displayed all over India to bring luck.