In the TV commercial from industry group Meat and Livestock Australia, a number of religious figures -- including Lord Ganesha, Jesus, Buddha and Scientology founder L. Ron Hubbard -- are seen sitting down together to a lamb-based meal and raising a glass to the meat.
The ad was met with anger in Australia's Indian community.
The Indian high commission (embassy) in Canberra said it had taken the issue up with the Australian government.
The Indian consulate in Sydney has also made a direct appeal to Meat and Livestock Australia to withdraw the commercial, according to the statement.
The industry body said it was meeting community groups to respond to their concerns.
It said it had undertaken extensive research and consultation when producing the advertisement, which was intended to promote inclusivity and not intended to offend.
Get the latest election news, live updates and election schedule for Lok Sabha Elections 2019 on ndtv.com/elections. Like us on Facebook or follow us on Twitter and Instagram for updates from each of the 543 parliamentary seats for the 2019 Indian general elections.