Stephan Turk, 67, shot his 18-year-old victim in the back as he and another robber were fleeing on a scooter with gems stolen from Turk's shop in the centre of Nice on the French Riviera.
The thieves had punched and kicked the jeweller before forcing him to open his safe at gunpoint, behaviour that Turk's supporters believe should be taken into account when judging his heat-of-the-moment decision to run after them and fire three shots as they sped away from his shop.
The two examining magistrates in charge of the investigation did not agree.
After a court hearing, Turk was charged with murder evening but released from custody on condition that he stays at an agreed residence and wears an electronic tag.
"Armed, aggressive thugs attacked me," Turk said in a brief statement to French television. "I regret what happened, I regret that he is dead. But it is him who decided to do what he did. It is normal that I would defend myself."
If convicted of voluntary homicide, the jeweller could spend the rest of his life in prison, and his fate has triggered a national debate over what constitutes reasonable self-defence.
By morning, a Facebook page set up in Turk's support had attracted nearly a million "Likes".
French law allows for killers to escape conviction for murder if they can show they acted in "legitimate defence".
But the prosecutor who recommended Turk be charged does not believe that can be applied in this case as the jeweller's life did not appear to be in immediate danger when he fired an unlicensed semi-automatic pistol.
The jeweller reportedly told the magistrates that he had fired his first two shots with the intention of demobilising the scooter and a third one in response to his victim threatening to shoot at him with a rifle.
The dead teenager had a string of previous convictions for assault, theft and driving offences.
The strong reaction to the case reflects widespread exasperation in France with current levels of gun crime and a perception that the perpetrators of violent robberies get off too lightly.
Mainstream politicians have generally avoided comment on the case, saying it is a matter for the courts. But it has been seized upon by the far-right Front National.
"When people feel obliged to defend themselves with such dramatic consequences, it is a sign that they no longer have any confidence in the state or the forces of order," FN leader Marine Le Pen said .