Local promoters Big Daddy Entertainment said on its website that the sold-out June 3 "Born This Way Ball" concert in the capital, Jakarta, was canceled and that 100 percent refunds would be given to ticket holders.
The U.S. singer, known for her outrageous stunts and provocative costumes, said in a message on Sunday to her 25 million Twitter followers: "We had to cancel the concert in Indonesia. I'm so very sorry to the fans and just as devastated as you if not more. You are everything to me."
"I will try to put together something special for you. My love for Indonesia has only grown," she added.
Indonesia, a secular state, has the world's largest population of Muslims.
Salim Alatas, the head of the hardline group Islamic Defender Front, described the "Bad Romance" singer earlier this month as a "vulgar singer who wears only panties and a bra when she sings and she stated she is the envoy of the devil's child and that she will spread satanic teaching."
Demonstrators holding banners saying "Go to hell Lady Gaga" staged protests in Jakarta last week.
The Jakarta Post quoted promoters of the concert as saying that the cancellation was due to fears not only for the pop star's safety, but for the 52,000 fans who had brought tickets.
Lady Gaga, who played before big crowds in the Philippines and Thailand last week, Tweeted on Sunday, "There is nothing holy about hatred."
National police had refused to give Lady Gaga a permit, citing the security concerns, but they were talks with the shows' promoters and tickets were still sold.
Lady Gaga said last week that Indonesian authorities were demanding she censor the show, and that she was considering ditching her backup dancers and performing the concert solo in Jakarta.
