The writer spent more than ten years in hiding after his 1988 book The Satanic Verses provoked a storm of criticism among Muslims and led to Iranian leader Ayatollah Ruhollah Khomeini proclaiming a fatwa against Rushdie, demanding his death.
In recent years, Rushdie's public appearances have increased but he cancelled a slot at Jaipur Literary Festival on Friday following protests and warnings he could be the subject of an assassination attempt. He will appear by videolink instead.
In a statement, the author said he axed his appearance at the event after receiving information his life could be in danger, adding, "While I have some doubts about the accuracy of this intelligence, it would be irresponsible of me to come to the festival in such circumstances."
In a post on Twitter.com, he adds, "Very sad not to be at jaipur. I was told bombay mafia don issued weapons to 2 hitmen to 'eliminate' me. Will do video link instead."
The Satanic Verses is banned in India and it's feared Rushdie's planned public appearance would re-ignite the controversy over the book, which many Muslims believe is blasphemous over its depiction of the prophet Muhammad.