Sarkozy’s office says threat by European Commission to launch legal proceedings is “unacceptable”.
A one-day EU summit on economic relations fell into disarray after leaders began to argue over French treatment of Roma people.
Vivane Reding, the EU justice commissioner, said on Thursday that she stood by her threat made two days previously to take France to the European Court of Justice for breach of EU rules over the expulsions of Roma.
However, Reding expressed regret for comparing the moves to deportations during the second world war.
European leaders were meeting in Brussels, the capital of Belgium, in an effort to create a united EU front on economic and diplomatic issues.
Boyko Borisov, the Bulgarian prime minister, said Nicolas Sarkozy, the French president, got sucked into a “fierce exchange” with Jose Manuel Barroso, the European Commission chief, over lunch on the Roma issue.
“Yes, there was a clash,” an EU source said, and explained that Barroso “vigorously defended” the role of the EC, which polices the application of EU-wide laws governing freedom of movement for all citizens.
Reding said that she held regret over the comparison of the deportation of Roma to the 76,000 Jews expelled from France to Nazi concentration camps and the internment of thousands of Roma in camps in France during the war.
She acknowledged through her office that “there should not be a parallel with World War Two”.
France has strongly defended its deportations of about 1,000 Roma back to poorer EU nations Romania and Bulgaria in August.
Speaking on Thursday, Bernard Kouchner, the French foreign minister, said: “Madame Reding … made unacceptable statements about French policy, in particular certain comparisons with the second world war.”
Nicolas Sarkozy, the French president, spoke with Reding on the sidelines of the meeting, but did not make any statement to the media.
Sarkozy has led the deportations, justifying them on the grounds of fighting illegal immigration and crime.
The move was part of a countrywide crackdown on the ethnic minority, which saw more than 100 camps dismantled.
Sarkozy has described the camps as sources of trafficking, exploitation of children and prostitution.
Authorities have denied that the expulsions targeted an ethnic group, saying they were on a case-by-case basis.
But news reports of a government letter ordering regional officials to speed up a crackdown on camps of Roma contradicted this.
The UN and Vatican have also criticised the expulsions.
Some 8,000 Roma have been deported from France since the beginning of the year, after 9,875 were expelled in 2009.