The acclaimed designer apparently told British reporters that Kidman uses "bizarre body make-up", reported imdb.com.
But Kidman's representative told the gossip website The Scoop: "Lagerfeld adores Nicole and they have long-standing mutual respect for each other as professionals."
The Oscar winning actress of "The Hours" was paid a reported $3.8 million to endorse Lagerfeld's Chanel No.5 perfume in an advertisement shot by her "Moulin Rouge" director Baz Luhrmann.