Causette, a monthly women's magazine, published an exchange of emails between French diplomats ahead of the awarding of the Legion d'Honneur on March 7.
President Francois Hollande awarded the honour to Prince Mohammed, who is also Saudi interior minister, during a visit to the Gulf nation.
Saudi Arabia is regularly criticised by international watchdogs for human rights violations and there was harsh criticism of Nayef's award on social media, particularly over its use of the death penalty, with people using the hashtag "#honte" (#shame) on Twitter.
According to one of the emails published by the magazine, Prince Mohammed requested the award "at a time in which he seeks to boost his international stature".
"I know some are raising questions about honouring the prince... certainly the kingdom does not have a good reputation," reads the email attributed to France's ambassador to Saudi Arabia, addressed to advisors in the presidency and foreign ministry.
"No reason not to do it: It must be discreet concerning the media, without covering it up," said the foreign ministry's North Africa/Middle East director.
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He said that if questioned why the award should be given, the government "should respond '(for the) fight against Daesh and economic partnership'. Of course, let's add, for good measure, elements about human rights." Daesh is another term for the Islamic State jihadist group.
The decision to go ahead with the Legion d'Honneur was taken hours later when Hollande gave the green light, other emails showed. The award was given just two days later.
France did not initially announce the news, which was first revealed by Saudi press agency SPA.
Jean-Marc Ayrault, the newly appointed foreign minister, told France Inter radio in the wake of the controversy that it was "a diplomatic tradition -- and I could tell you about many Legions d'Honneur that have been given".
France has close ties to Saudi Arabia, has sold billions of euros worth of weapons to Riyadh, and sees the kingdom as crucial to intelligence sharing about jihadist groups.
But critics point out that Saudi Arabia has spent decades funding the spread of its hardline Wahhabist teachings across the world, which is widely seen as underpinning the very jihadist threat that France is trying to defeat.
In 2015, Saudi Arabia executed 153 people, according to an AFP tally. Seventy-one people have been executed so far this year.