In an interview to Women's Wear Daily, Lagerfeld, who is the head designer and creative director of Chanel, had said that he had been working on a design for Streep and according to him she decided to pull out of the agreement over money.
The 67-year-old actress lashed out at the designer, saying he had lied and that now she is not going to take the matter lightly, reported People magazine.
"That publication printed this defamation, unchecked. Subsequently, the story was picked up globally, and continues, globally, to overwhelm my appearance at the Oscars, on the occasion of my record breaking 20th nomination, and to eclipse this honor in the eyes of the media, my colleagues and the audience," Streep said.
She added, "I do not take this lightly, and Mr Lagerfeld's generic 'statement' of regret for this 'controversy' was not an apology. He lied, they printed the lie, and I am still waiting."