We study the tensor product of Demazure crystals for symmetrizable Kac-Moody Lie algebras. It is not necessary that the tensor product of Demazure crystals is isomorphic to a disjoint union of Demazure crystals. In this paper, we provide necessary and sufficient conditions for the decomposition of the tensor product of Demazure crystals as a disjoint union of Demazure crystals. Our results are the generalization of the results proved by Anthony Joseph and Takafumi Kouno. As an application, we obtain a sufficient condition when the product of Demazure characters is a linear combination of Demazure characters with nonnegative integer coefficients. In particular, we obtain a partial solution for the key positivity problem.