The Indonesian government has reassured Muslims that it is OK to say Merry Christmas, after the head cleric of the Ulema Council, the main Islamic group, tried to ban the term.
Cleric KH Ma'Ruf earlier said wishing people Merry Christmas was forbidden by Islam.
But the ABC reports religious affairs minister Suryadharma Ali has contradicted this view, saying it is not unusual to convey Christmas greetings to Christians.
He said that saying Merry Christmas does not amount to participating in a forbidden religious ritual and has appealed for tolerance and diversity.
Thousands of extra police are rostered on to guard Christian churches against the threat of terrorist attacks.