Online LGBT site PinkNews published a story with the headline "People think Prince George looks fabulous in this new photo," saying people on Twitter had called him a “gay icon”.
It originally stated: "The image of the prince expressing his happiness in this way led many to declare their support of George for a whole new position: gay icon."
The four-year-old Prince is pictured in the story with his hands on his face during a state visit to Germany with his mum and date, Kate and William, last month.
But Jim Allister, party leader of the Traditional Unionist Voice (TUV) has blasted the article "grossly offensive”, saying “sexualising a young child in this fashion is entirely inappropriate".
He claims he has emailed the publication urging it to take the article down, saying: "To take an image of a little boy and to fantasise of him being an icon for a life defined by sex is outrageous and sick."
But the chief executive of PinkNews, Benjamin Cohen, has told the BBC he had "no intention" of doing so and that the article was “tongue-in-cheek”, based on the comments on “hundreds” of social media users.
Mr Allister’s complaint reads: “With multiple media outlets clearly obsessed with LGBT issues I find it amazing that this inconvenient article has been completely ignored.
"While anyone who dares to challenge whatever the latest demand of the LGBT lobby is will be subject to scrutiny this grossly offensive article has passed without comment.
“I would have referred Pink News to the Press Standards Organisation but it appears that they have not signed up to the Editor’s Code of Practice.