Jean-Marie Le Pen's National Front issued the poster in southern France ahead of regional elections that start Sunday and end March 21.
The poster shows a woman in a black face-covering Muslim veil next to a map of France covered over by an Algerian flag. Minarets dot the map.
"We have officially protested," Algerian Foreign Minister Mourad Medelci said. "It is up to the French state to take the necessary measures when foreign countries' symbols are denigrated."
France has the largest Muslim population in western Europe, estimated at 5 million.
The center-right government of French President Nicolas Sarkozy has spoken out against head-to-toe veils and is moving toward banning them in many public places. Critics contend the move is a political ploy to divert attention from more substantial issues and is aimed at attracting far-right voters in the regional elections.