Heena Sidhu, a commonwealth games gold medallist, tweeted an explanation why she would not take part in the Asian Airgun Shooting Championship in Tehran in September.
The defending champion of the competition, Ms Sidhu said the requirement for the shooters to dress in accordance to Islamic principles was not in the spirit of the sport.
The competition's official website clearly states all athletes must wear clothes in compliance with the rules of the Republic of Iran.
The 27-year-old told Times of India: "Forcing tourists or foreign guests to wear 'hijab' is against the spirit of the game. Since I don't like it, I have withdrawn my name.
"You follow your religion and let me follow mine. I’ll not participate in this competition if you are going to force me to comply with your religious beliefs."
In a series of tweets, Ms Sidhu denied being a revolutionary but declared her pride in her sport as it brings people together from different cultures, backgrounds, sexes, ideologies and religion.
Ms Sidhu stressed she did not wish her decision to be politicised or distract from the upcoming competition - wishing good luck to her fellow Indian shooters.
She won a bronze medal in the rgw Women's team sabre fencing.
Egypt's Doaa Elghobashy and her partner Nada Meawad wore hijabs and long sleeves and trousers to compete in the Olympic beach volleyball competition - Egypt's first ever Olympic team to compete in a beach volleyball tournament.
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