"The repulsive and mean-spirited preoccupation with the prime minister's wife's outfit isn't proper," Deri wrote on his Facebook page. "Such an honorable occasion cannot be pushed aside in favor for such activity."
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Deri added: "Public representatives' families should be kept outside the political game."
Haredi website Kikar HaShabat posted an anonymous column which criticized Netanyahu's immodest attire. Other websites mentioned that Deri appeared embarrassed when he met Israel's first lady.
Sara Netanyahu at Knesset inauguration
Deri was outraged: "I am not used to discussing gossip, but this time it seems the preoccupation with the issue has gone beyond any proportion, including an attempt to involve me in this unpleasant media theatrics."
Deri said that "during the event my wife and I talked pleasantly with Mrs. Netanyahu," and that the only embarrassment he felt was caused by how "cheap gossip and humiliation of the worst kind is the bread-and-butter of our daily lives."
Minister Limor Livnat also referred to the affair, and said that "every woman, regardless of her political inclination or personal fashion sense, should feel deeply offended and angry in the face of this chauvinistic exhibition of hate."
Sara Netanyahu arrived at the Knesset's inauguration session wearing a relatively see-through, tight lace dress.
In the column posted on Kikar Hashabat it was written that her attire offended haredim: "She arrived in an undignified outfit, which to a bystander seemed outrageous, with no consideration to the haredi and religious house members."
Yuval Karni contributed to this report
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