The incident occurred Jan 2 at a government boarding school in Keonjhar district's Telkoi village, about 250 km from here, when a seven-year-old Class 1 student came to school after Christmas holidays, District Collector S.K. Swain told IANS.
The girl's father lodged a complaint against the school teacher when his daughter returned home.
"We suspended the teacher Sunday after the allegation was found to be true," Swain said, adding the girl was also brought back to school for studies.
Further investigation was on, he said.
The brutalities related to witchcraft, mainly against women, are common in the tribal pockets of the state. Women and girls accused of witchcraft are often killed or paraded naked.
The state has recently approved a new law to curb such crimes with provisions of imprisonment up to seven years and penalty for such offenders.