Ninety one Jews were killed and more than 30,000 were rounded up and sent to concentration camps across Germany and Austria.
It is viewed as the prelude to the Final Solution and the murder of six million Jews during the Holocaust.
The Anti-Defamation League’s associate director of European affairs Dalia Grinfield took to Twitter to vent, writing:: "How wrong can you get on Kristallnacht KFC Germany. Shame on you!"
Daniel Sugarman, director of public affairs at the Board of Deputies of British Jews, slammed the advertisement as “absolutely hideous”.
KFC Germany has since apologised for the message, claiming it was the result of an “error in our system”.
A spokesperson said: “Due to an error in our system, we sent an incorrect and inappropriate message through our app. We are very sorry about this, we will check our internal processes immediately so that this does not happen again. Please excuse this error."