The Scout Association described the show as "deplorable and in bad taste" and is asking Sir Elton for a formal apology and a charitable donation by way of redress.
Sir Elton, 52, introduced the dancers, who peeled off their uniforms and caps to the tune of "It's A Sin" by the Pet Shop Boys. The dancers knelt on the floor, grabbed their groins and stripped to skimpy shorts.
Among guests at the concert on Sunday at the Royal Albert Hall in central London, which was held to celebrate Stonewall's 10th anniversary, were the Prime Minister's wife, Cherie Blair and the MPs Frank Dobson and Simon Hughes.
John Fogg, a spokesman for the Scout Association, said: "We think it is pretty deplorable and in bad taste in terms of denigrating our uniform and what it stands for. We are disappointed that someone of Sir Elton's standing should involve himself in something of such poor taste. It linked homosexuality with paedophilia. If Stonewall are completely for the rights of homosexual people, they have not done themselves any favours."
Mr Fogg said the routine was "an error of judgement" and added that he hoped Sir Elton now realised his mistake. "The association would welcome any positive sign of regret from Sir Elton, including his holding a concert for some of the association's young members, a donation or taking part in one of its child-welfare campaigns," Mr Fogg said.
A letter outlining the concerns of the Scout Association's chief executive, Derek Twine, was sent to Stonewall's chief executive, Angela Mason, urging the group to seek to "educate and inform, and avoid the reinforcing of stereotypes".