The cartoon by Dieter Hanitzsch showed Netanyahu carrying a missile in his hand. He is dressed up as Israeli singer Netta Barzilai, who won this year's Eurovision contest. A speech bubble on top says: "Next year in Jerusalem."
The cartoon led to an uproar on social media and other German media outlets.
Suddeutsche Zeitung's Editor-in-Chief Wolfgang Krach apologised for the caricature, however Hanitzsch refused.
Speaking to local media outlets, the 85-year-old cartoonist said he wanted to criticise Netanyahu's exploitation of the Eurovision contest for his own purposes and accused him of abusing the singer's victory.