An Australian head teacher is under fire after removing the word gay from the famous song Kookaburra Sits in the Old Gum Tree.

Garry Martin told pupils at Melbourne's Lepage Primary to substitute the word fun for gay in the chorus: "Laugh, kookaburra, gay your life must be."

"I knew if we sing 'Gay your life must be' the kids will roll around the floor in fits of laughter," Mr Martin told a local radio station.

"I wasn't trying to insult gay people."

But after a local newspaper reported his change to the campfire classic, Mr Martin began receiving angry e-mails from readers and criticism from gay rights groups.

The school principal admitted he had probably been "hypersensitive", but said the word gay was commonly used as a playground insult and he was keen to minimise disruption in the classroom.