The poster, produced by People for the Ethical Treatment of Animals (Peta), launched in Easington, County Durham, showed an overweight child about to eat a hamburger, with the words: "Feeding kids meat is child abuse. Fight the fat. Go Veg."
Richard Lowe, marketing director with the Meat & Livestock Commission (MLC), described the advert as "sensationalist nonsense", adding that Peta was drawing a distinction between the UK's levels of obesity with the country's rate of meat consumption - which was inaccurate as other European countries ate much more meat than the UK.
Doug Brydges, president of the International Meat Trade Association, said: "The advert is highly emotive and inaccurate. Quite frankly it's disgraceful."
Anita Singh, Peta campaign co-ordinator, claimed meat was a direct factor in the UK's childhood obesity problem. She said: "Vegetarian kids are slimmer, have more energy, get better grades and are all-around better off than their meat eating peers."
Responding to why the advert links eating meat to child abuse, Singh said: "If people are shocked by this ad then we are hoping they take the initiative to look into it by visiting our website - to find the truth behind the meat industry.
"Yes, it's controversial and we realise that. To call it scare mongering is the same as burying one's head in the sand."
She added animals were intensively farmed, pesticides were used in meat production and meat products were full of drugs, hormones and saturated fat - all being consumed by children.
"No parent wants their child to eat that... Parents need to act responsibly for their children's well being...hopefully they will make a compassionate decision for the animals and for their children," she added.
Lowe said: "It's confusing for parents - it goes wholly against the advice on the Food Standards Agency website which says meat makes up part of a balanced diet and provides essential levels of iron for children. I think Peta have been incredibly irresponsible."
He added the MLC would wait to see how widely the Peta advertising campaign developed and said it would consider filing a complaint with the Advertising Standards Authority (ASA).