“Gangnam Style” singer Psy will NOT sue an L.A. restaurant for naming itself after the famous song — in fact, Psy’s pumped … because as far as he’s concerned … imitation is the sincerest form of flattery.

The Koreatown restaurant was previously known as Soju Town — but it re-opened last month after a brief closure under its new name “Gangnam Style,” clearly an homage to the popular song.

The restaurant never bothered to get Psy’s permission to use the name — but sources close to the singer say he doesn’t give a crap … because where he comes from, imitation is a form of honor.

We’re told Psy’s team briefly considered legal action when they caught wind of the new restaurant, but since Psy doesn’t care … they don’t plan to pursue anything. 

Oppa!