Hampstead's Royal Free Hospital has withdrawn its consent for a giant electric menorah in the entrance area.
The menorah was placed on Tuesday by Tzivos Hashem, a charity run by Rabbi Yossi and Chanie Simon, after permission was received from the hospital's communications officer. On Wednesday, the couple were told to remove it.
Mrs Simon said: "We have been working for four years to get permission for a menorah in the hospital lobby. Last year they said it wasn't possible because of construction work so this year we asked again. My husband brought in a menorah to show them and explain about it and last week we were given permission."
She claimed the hospital had a change of heart after a staff member complained about the prominent siting of a religious symbol.
Mrs Simon was "very upset and disappointed. So many people stopped to look at it and said how nice it was. It does not have to be a religious symbol but a cultural communal one.
"There is a menorah in the chapel but sick people don't want to go downstairs to see it."
A Royal Free spokeswoman apologised for "a genuine mistake in authorising the menorah to be erected in the hospital's main entrance.
"It has been the trust's established practice over many years to use the hospital's public areas to support the work of the hospital, for example health promotion.
"We are very mindful of the important place that faith has in the lives of many of our patients, staff and visitors and have a facility for religious observance in the multi-faith chapel.
"Over Chanucah, our Jewish chaplain the Rev Bernd Koschland has arranged for candles to be lit in the chapel, as is our normal practice."