The Advertising Standards Authority has decided there are not grounds to formally investigate the ad, which features a chicken strutting to DMX’s X Gon’ Give to Ya.
The ASA confirmed this morning it had received 480 complaints, many of which said the ad was "disrespectful" to chickens, was "offensive" and also "distressing".
Some viewers also complained the ad is misleading because it features a healthy, older-looking chicken, which they believe misrepresents the age, quality and living conditions of KFC chickens.
"The whole chicken" phrase was also alleged to be "misleading" because not all parts of the chicken are used in KFC products or because additional ingredients are used.
Other viewers even objected to the use of a "gangster song" with lyrics that allude to guns.
However, the ASA’s council decided the ad did not break its rules.
A spokesman said: "Overall, while we acknowledge some viewers may find the ad distasteful it is unlikely to cause distress or serious or widespread offence."
Instead, the ASA said the ad will be seen as "bizarre" and an attempt at light-hearted humour. It said there are no explicit images to references to animal slaughter. It added that the ad depitcts a fantastical scenario that would not depict the chicken as truly representative as those used in KFC products.
Regarding "the whole chicken" claim, the ASA said this would be interpreted as KFC using 100% chicken in their products, rather than using every single part of the chicken.
It also dismissed complaints about the song choice, given that it was used in the context of a chicken strutting and dancing and so was unlikely to condone the use of weapons or violence.