The comments by Mr Sarkozy are claimed to have been made at a meeting with Israeli premier Benjamin Netanyahu last week in Paris. There has been no official denial or confirmation of whether the report is true though.
Israeli Arab leaders have accused Lieberman of being a racist.
However, whilst the foreign ministry of Israel did not approve of what the French leader is said to have said, Ahmed Tibi, of the Israeli parliament for the United Arab List, was in agreement with the comments attributed to President Sarkozy.
Nevertheless, the deputy leader of Lieberman's party claimed that for the president of France to have said such a thing was "grave and unacceptable".
According to the television station, President Sarkozy had suggested to Mr Netanyahu that he should "get rid" of Mr Lieberman and that it would be a good idea if his predecessor Tzipi Livni be reinstated.
