A Bangkok hotel with a 'demon gargoyle' statue at its entrance was ordered by authorities to relocate the controversial display following complaints from terrified locals.

The Bazaar Hotel transferred the Khru Kai Kaeo sculpture - a towering winged demon with sharp red talons and golden fangs - to the rear of the hotel to comply with an order from the State Railway of Thailand on December 28.

The statue had left superstitious locals fearing they would suffer ill fortune from the 'haunted' deity. They claimed it promoted demon worship and 'un-Buddhist' practices.

The Bazaar Hotel was also ordered to pay a 1.3 million THB (38,015 USD) fine for violating the Building Control Act.

Following the relocation, the front area of the hotel will now be transformed into an activity space for guests, catering to its foreign clientele.

The 'Khru Kai Kaeo' statue was erected in August, but sparked controversy when the Council of Artists Supporting Thai Buddhism called on the Bangkok Metropolitan Administration to remove it, alleging that it promoted demon worship.

Concerns were raised about Khru Kai Kaeo worshippers endorsing 'un-Buddhist' practices including animal sacrifice.

Thailand, formerly Siam, is a predominantly Buddhist country. The religion stems from the Khmer Empire, which covered much of Southeast Asia.