The near-century old Australian-made Coon cheese will be renamed after the brand's owners acknowledged the racial overtones of the label.
Indigenous activist Stephen Hagan wrote to Coon's Canadian-based owners Saputo in June about the name, highlighting the word was an offensive term that demeaned people of colour.
Dr Hagan celebrated news of the name change as "a victory for all of us, particularly activists like myself who dare to challenge the status quo on issues of race".
He received a letter on Friday from the company's chief executive saying they had decided to retire the name following a "careful and diligent review".
In his letter, Lino Saputo said a new name would align "with current attitudes and perspectives."
"At Saputo, we believe we all share in the responsibility to eliminate racism in all its forms and we feel this is an important step we must take to honour this commitment," Mr Saputo wrote.
"We trust our consumers and our customers will understand our point of view on this topic."
Mr Saputo said the company would consider recognising American Edward William Coon, the man credited with inventing a ripening process used to make the cheese in the early 20th century.
Dr Hagan questioned the authenticity of claims the Australian cheese was named after Mr Coon.
The word coon first emerged as a racial slur in America in the 18th century.
"In these enlightened times, people ought to be considering the feelings of people of colour and First Nations people," Dr Hagan told AAP.
The wave of global racial awareness following the death of George Floyd in the US has also resulted in sweet brands Redskins and Chicos being scrapped.
Australian Associated Press