Meanwhile, a number of streets in England renamed to remove colonial references.
The decision of the Tangerhütte kindergarten has sparked a backlash, led by the International Auschwitz Committee.
Deputy head Christoph Heubner said: "If one is prepared to forget one’s own history so easily, especially in these times of renewed antisemitism and Right-wing extremism, one can only feel fear and anxiety about the culture of remembrance in our country."
There has been an increase in antisemitism in Germany in the aftermath of Hamas' October 7 terror attack in Israel.
Hamas militants killed 1,400 Israelis and took more than 230 hostages.
Last week German Vice-Chancellor Robert Habeck vowed to crackdown on an increase in cases of antisemitism.
"Anyone who is German will have to answer for this in court," he said.
"Anyone who isn't German also risks losing their residence status. Anyone who doesn't yet have a residence permit is giving grounds for deportation."