PARIS (REUTERS) - Vandals attacked a giant green inflatable sculpture in one of the most famous squares in Paris in the early hours of Saturday after its resemblance to a sex toy sparked an outcry.

The 24m-high canvas artwork by US artist Paul McCarthy was unveiled on Thursday in Place Vendome, famous for its luxury jewellery stores and the Ritz Hotel.

"An unidentified group of people cut the cables which were holding the artwork, which caused it to collapse," police told Reuters.

"The person responsible for the piece then decided to deflate it to avoid it being more seriously damaged."

The deflated sculpture was being removed from the square on Saturday afternoon.

McCarthy told French newspaper Le Monde that his work "Tree" was inspired both by a sex toy called a butt plug and a Christmas tree.

It was part of the International Contemporary Art Fair (FIAC) taking place Paris on Oct 23-26.

Paris Mayor Anne Hidalgo said the attack was unacceptable and also denounced an assault on McCarthy the day he installed the work, when a man hit him in the face before running away.

"Paris will not succumb to the threats of those who, by attacking an artist or a work, are attacking artistic freedom," she said in a statement.

"Art has its place in our streets and nobody will be able to chase it away."