Information Minister Rais Yatim said on Twitter that the concert was cancelled because it breached government guidelines on “religious sensitivities and cultural values” in the Muslim-majority country.
“The ‘Allah’ graphic on the singer’s body will surely cause controversy among Muslims,” Rais said.
In separate comments quoted by state news agency Bernama, he warned the concert would “lead to bigger problem” by threatening national security and tarnishing the government's image.
The acclaimed soul artist had been scheduled to perform in the capital Kuala Lumpur.
Organiser Pineapple Concerts said late Tuesday on their website they were working “to rectify the issues that we’re facing”.
“Erykah Badu and Pineapple Concerts will still like to carry on with the show.”
Malaysian Islamic groups frequently oppose concerts by Western artists whom they accuse of promoting promiscuity and corrupting youths, but rarely are high-profile acts cancelled once initial approval has been granted.
The offending photo appeared Monday in Malaysia’s biggest English-language daily, The Star.