Gretchen Ertl for The New York Times

Sitting in their offices high above Park Avenue late on Monday, the private equity executives who own the country’s largest gun company received a phone call from one of their most influential investors.

An official at the California teachers’ pension fund, which has $750 million invested with the private equity firm, Cerberus Capital Management, was on the line, raising questions about the firm’s ownership of the Freedom Group, the gun maker that made the rifle used in the Connecticut school shootings.

Hours later, at 1 a.m. on Tuesday, Cerberus said that it was putting the Freedom Group up for sale.

“It is apparent that the Sandy Hook tragedy was a watershed event that has raised the national debate on gun control to an unprecedented level,” Cerberus said in a statement.

The move by Cerberus is a rare instance of a Wall Street firm bending to concerns about an investment’s societal impact rather than a profit-at-all-costs ethos. Public pension funds like the California one — officially, the California State Teachers’ Retirement System, or Calstrs — have hundreds of billions of dollars in private equity and hedge fund investments. While their influence is vast, it is usually exerted behind the scenes and rarely prompts snap business decisions.

Yet in a sign of how deep the shooting rampage in Newtown, Conn., has resonated throughout the country, Cerberus signaled that it wanted to remove itself from the uproar over the nation’s gun laws in seeking to sell Freedom, which makes the Bushmaster rifle used in the massacre.

“As a firm, we are investors, not statesmen or policy makers,” the Cerberus statement said. “It is not our role to take positions, or attempt to shape or influence the gun control policy debate. That is the job of our federal and state legislators.”

While concern from Cerberus’s investors — as well as a swirl of media attention — had an impact on the decision to sell, the leadership of the private equity firm debated through the weekend how to respond to the tragedy and its potential fallout, according to a person familiar with the firm’s discussions. On Monday evening, a small group of Cerberus’s top executives sat around a conference room table and weighed a range of options to respond to the tragedy, including making a large donation to the Newtown community or promoting mental health research and education.

Ultimately, Cerberus decided to make a clean break and sell the gun company. “We believe that this decision allows us to meet our obligations to the investors whose interests we are entrusted to protect without being drawn into the national debate that is more properly pursued by those with the formal charter and public responsibility to do so,” the firm said in its statement.

Calstrs executives and other public officials applauded Cerberus’s action. Thomas P. DiNapoli, the New York state comptroller, said he supported Cerberus’s decision to sell the Freedom Group and ordered a review of the state pension fund’s investments in firearms manufacturers. The $150 billion New York State Common Retirement Fund has $50 million invested with Cerberus.

Brendan Smialowski for The New York Times

Cerberus, a private equity and hedge fund firm that manages more than $20 billion, is owned by the billionaire financier Stephen A. Feinberg. His father, Martin Feinberg, lives in Newtown, Conn., where the shootings occurred. The elder Mr. Feinberg did not return telephone calls, but Bloomberg News quoted him as saying that the shooting was “devastating” and “horrendous, truly horrendous.” Stephen Feinberg declined to be interviewed.

It is not clear whether Mr. Feinberg will find a ready buyer for the Freedom Group. Over the last two days, shares of the publicly traded American gunmakers, Sturm, Ruger & Company and Smith & Wesson, have dropped precipitously on fears of increased gun regulation. Several foreign gun manufacturers, including Forjas Taurus of Brazil and Heckler & Koch of Germany, could be possible acquirers, according to a banker familiar with the weapons industry.

Cerberus said it would retain a financial adviser to sell its interests in the Freedom Group and then return the sale proceeds to its investors.

This is hardly the first time that the publicity-shy Mr. Feinberg has come under scrutiny because of a Cerberus holding. In the last decade, during the peak of the leveraged buyout boom, Cerberus made national headlines after buying two of the country’s best-known companies, the automaker Chrysler and the finance arm of General Motors.

Having made those acquisitions just before the financial crisis struck, Cerberus suffered losses on both deals, and Mr. Feinberg told his clients that the firm would in the future stay away from such prominent investments.

Despite that vow, Mr. Feinberg again has found himself in an uncomfortable spotlight. The Freedom Group’s origins date to 2006, when Cerberus acquired Bushmaster Firearms. The firm then consolidated the fragmented gun industry, acquiring at least six other brands and rolling them into one company to create the Freedom Group, which is based in Madison, N.C. Freedom is on track to post about $900 million in revenue this year.

Other brands under the Freedom Group umbrella include Remington Arms, the country’s largest and oldest maker of rifles; Marlin Firearms, a manufacturer of lever-action rifles; and Advanced Armament, a maker of pistol silencers. The company filed for an initial public offering of stock in 2009, but it withdrew the offering last year after its financial performance flagged.

Mr. Feinberg has a penchant for investing in military-related businesses. Cerberus’s holdings include the military contractor IAP Worldwide Services and the satellite provider GeoEye. Cerberus also explored an investment in Blackwater USA, the private security contractor since renamed Academi, but a deal never materialized.

A major Republican donor, Mr. Feinberg has Dan Quayle, the former vice president, and John Snow, the former Treasury secretary, on Cerberus’s payroll. Among the former military leaders on Freedom Group’s board is George A. Joulwan, the onetime supreme allied commander of Europe.

Mr. Feinberg is also an avid shooter and hunter — he favors a Remington 700 — and has a membership at the upscale hunting club Mashomack Preserve Club in Pine Plains, N.Y.

A fellow firearms enthusiast and Cerberus executive, George Kollitides, has served as the Freedom Group’s chief executive since March. Mr. Kollitides is a trustee of the NRA Foundation and a director of the New York State Rifle and Pistol Association.

The son of a steel salesman, Mr. Feinberg, 52, was raised in Spring Valley, N.Y., in Rockland County. After graduating from Princeton, he started his Wall Street career working at Drexel Burnham Lambert during the bank’s heyday in the 1980s. After developing a specialty trading in the distressed debt of troubled companies, Mr. Feinberg struck out on his own to start Cerberus.

Though the Freedom Group was unable to complete its initial public offering, the deal has been largely successful, with Cerberus already making a small profit via a dividend payment, a person briefed on the investment said.

If it is able to sell the Freedom Group for additional profit, the beneficiaries would be Cerberus’s investors, which include two of the country’s largest pension funds — Calstrs and the California Public Employees’ Retirement System.

On Tuesday, Ricardo Duran, a spokesman for Calstrs, said it would remain an investor with the firm. Calstrs has $600 million invested across two Cerberus funds with interests in the Freedom Group; its share of the Freedom Group investment amounts to a 2.4 percent stake in the gunmaker.

“They are taking a very responsible approach to this and we are happy that they’re selling,” Mr. Duran said.

Bill Lockyer, the California treasurer, said the state’s pension funds should not own stakes in any companies that make assault weapons.

“Our objective is to make sure that both Calpers and Calstrs are scrubbed clean of any investment in any company that makes guns that are illegal in this state and expose our communities to violence and death,” Mr. Lockyer said in a statement. “We’re pleased that Cerberus is taking this action, but our initiative extends far beyond one company.”