Mr Macron told Australian journalists on the sidelines of the G20 meeting in Rome "I don't think, I know" the prime minister lied to him about the torn-up deal.
"I have a lot of respect and a lot of friendship for your people," he said.
"I just say when we have respect, you have to be true and you have to behave in line and consistently with this value."
Mr Morrison rejected Mr Macron's accusation.
"No," the prime minister said.
"I will always stand up for Australia's interests."
At issue is Australia's handling of the decision to dump the contract with France in favour of a deal to buy nuclear-powered boats instead under the AUKUS partnership with the UK and US announced in September.
This angered France, which has said it was not told ahead of the announcement and retaliated by recalling its ambassador to Australia.
US President Joe Biden on the weekend described the way the decision by the AUKUS partners was handled as "clumsy".
"I think what happened was - to use an English phrase - what we did was clumsy. It was not done with a lot of grace," Mr Biden said during a meeting with Mr Macron in Rome.
"I was under the impression certain things had happened that hadn't happened."
Back in Australia, Acting Prime Minister Barnaby Joyce urged everyone to move on from the submarine issue.
"He (Mr Macron) can say that, I understand that people are hurt, but we have got to act like senior politicians as well, and this issue has got to move on," he told the Seven Network on Monday.
"You just had to read the papers. You have got a pretty good idea that things were not hunky-dory with the contract."
Agriculture Minister David Littleproud said Mr Macron's ire had more to do with the upcoming French presidential election than the contract.
"It's unreasonable. The prime minister had dinner with the president in June and made it clear the subs we were purchasing would not meet our strategic needs into the future," he told the Nine Network.
"The prime minister did everything he could diplomatically without blowing up a strategic opportunity to strengthen our defence ties here in Australia."
