Alejandro Inarritu felt that Sean Penn's immigration remark at 2015 Oscars was "hilarious."
The Mexican film director said that it was nothing more than a brutal joke between old friends, ABC News reported.
The 51-year-old further added that he has told many similarly brutal jokes at Penn's expense.
However, the remark struck many online as problematic for an awards ceremony that had been criticized for not having more nominees of color.
Inarritu joked that after his three wins, the Academy of Motion Picture Arts and Sciences might institute a residency requirement. His win in the best directing category marks back-to-back wins for Mexican-born directors; last year Alfonso Cuaron won that honor for 'Gravity.