Mr Macron’s centrist party withdrew support for Sara Zemmahi, a quality engineer, after she was pictured in a poster with her head covered. In France, Muslim headscarves are banned in classrooms but are not forbidden in public spaces or campaign posters.
Ms Zemmahi was shown in a campaign poster wearing a white headscarf before the June election.
Mahfoud Benali, the lead candidate on the list for the district in the southern city of Montpellier, lashed out at Mr Macron’s decision.
Mr Benali said: “I’m frankly pained by the decision.”
He added how Ms Zemmahi was on a work trip and was not available to provide a comment.
While the decision has been met with anger, Stanislas Guerini, head of Mr Macron’s LREM party, defended the move.
He said: “We consider that ostentatious religious signs don’t have their place on posters, whatever the religion.”
Mr Guerini confirmed the party would no longer support Ms Zemmahi, who was one of four people pictured in the campaign poster.
Even Marine Le Pen’s far-right party backed the decision of Mr Macron – despite being rivals ahead of the 2022 presidential elections.
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Mr Macron’s party voted overwhelmingly in favour of the bill back in February before it was passed up to the Conservative-led Senate.
Last month, Mr Macron vowed on Twitter that “in our fight against Islamist terrorism, we will never give in.
“The nation is by the side of her family, her colleagues and security forces,” he added.
The legislation came after France was hit with three deadly attacks late last year.
These attacks included the beheading of a teacher who had shown his students’ caricatures of the Prophet Muhammad during a lesson on free speech.
Mr Macron said France will not “surrender” following a fatal knife attack in Nice which left three people dead.
He said: “If we are attacked once again it is for the values which are ours: freedom, for the possibility on our soil to believe freely and not to give in to any spirit of terror.
“I say it with great clarity once again today: we won’t surrender anything.”
France was the first country to ban the niqab in public spaces back in 2011.
French towns have since banned the burkini, sparking a national conversation around nationalist, identify and feminism.