Villepin told cabinet colleagues on Thursday during a government meeting that the law, meant primarily to banish Muslim headscarves from state schools, had put Paris in "a very delicate situation on the international scene," according to government sources.
French foreign policy was now in "an awkward position ... towards Arab countries, and also towards the United States," they quoted him as saying.
Villepin recently defended the looming ban on a tour of the Gulf states, where there have been demonstrations and hostile media reaction against what was seen there as discrimination against France's five million Muslims.
The US ambassador for religious freedom, John Hanford, voiced misgivings last month, citing Muslims who said the ban went too far. "We are very concerned that that not be the case," he told reporters in Washington.
Few commentators abroad seem able to follow the French logic that says the ban reinforces respect and tolerance for all religions by keeping all of them out of schools. Many see it as a violation of religious freedom.
The planned ban, which if passed would bar Muslim hijab, Jewish skullcaps and large Christian crosses from September, has provoked protests from Islamic leaders and criticism from other religions in France.
It prompted Pope John Paul to make a barbed reference last week to "some European countries" that endangered religious freedom, a rare criticism that provoked an equally unusual rebuke from the French official who first proposed the ban.
The debate has also angered France's 5000 Sikhs, who have turned to India and international Sikh leaders to help them keep the right to wear their trademark turbans in state schools.
On the domestic front, the debate over the ban has taken several unexpected twists, such as a suggestion by Education Minister Luc Ferry that beards and bandannas could also be outlawed if they are seen to be statements of faith.