The picture was immediately denounced as a photo-montage and "a ruthless attempt at blackmail", while a public prosecutor ordered the arrest of the offending newspaper editors for insulting a public figure. One has already been fined heavily and the others await trial.
This scandalous affair tells us something. Dimitra Papandreou, popularly known in Greece as Mimi, is no longer just the Prime Minister's bimbo. Her enemies are at war with her and they mean to fight dirty. It also tells us that Mimi can and will take them on.
For the Greek tabloids may have gone too far, alienating a public that might previously have thought no criticism of the Prime Minister's wife too outrageous. For the first time, Mrs Papandreou has succeeded in portraying herself as a victim and, mirabile dictu, even made herself a little bit popular.
She has come a long way since the day she made her public debut at the side of her future husband, Andreas, at a European summit on Rhodes in 1988. At the time both were married to other people, and although Mr Papandreou had a reputation as a womaniser he had never before appeared with a mistress in public, let alone at a state occasion.
It caused a sensation. What was the Prime Minister of Greece, then nearly 70 and recovering from major heart surgery, doing at an international meeting with a blonde air hostess less than half his age? Mr Papandreou, said the wags, had discovered a new sexual position: doing it with one foot in the grave.
That was only the beginning of the ridicule for Dimitra, but as her status and power have increased - from mistress to wife, from air hostess to head of the Prime Minister's private office, from vacuous blonde to budding politico - so the tone has changed.
The tabloid papers contented themselves for a long time with printing old photos of her sunbathing topless, figuring that no woman could ever advance up the political ladder as long as her breasts were more familiar than her brains. But as her perceived influence on her ailing husband has grown the froth has gone out of the campaign against her.
Despite all the official wrath last week, more compromising photos followed. Star published one of her naked inside a church. Others appeared in Avriani, whose editor, George Kouros, claims he has 185 more up his sleeve, including one of her in the arms of a well-known journalist and another of her holding a penis.
They may all be montages - we do not know - but Mr Kouros makes no bones about his intentions: "This is a political battle to demolish the rotten court around Dimitra which is made up of wizards, witches, astrologers, priests, confidence tricksters and lesbians."
This is an extreme statement of a popular view: Dimitra is widely regarded as a gold-digger. She won few points for helping break up Mr Papandreou's 38-year marriage to his popular American second wife, Margaret, and fewer still for provoking a damaging split in Mr Papandreou's Pasok party this summer over her ambition to run for parliament at the next elections in 1997.
She has been compared to every scheming woman in the history books, from Salome to Eva Peron. She is the hottest political issue in Greece, as politician after politician has been pushed into the dog-house for daring to criticise her in public.
Her entourage, which does indeed include two Orthodox priests and an astrologer as well as young politicians and members of Athens high society, is increasingly seen as a clique anointed from on high to take over Pasok when Mr Papandreou finally steps down.
Publishing the pictures was in part an attempt to counteract her efforts to claim respectability and gravitas. Gone are the tight black mini-skirts, cute anklets and thonged bikinis, and not just because she recently turned 40; these days the Prime Minister's wife dresses in impeccable button- up Armani suits with a Greek Orthodox cross hanging demurely from her neck.
She was in defiant mood when she spoke to the Italian newspaper Corriere della Sera this week in her first interview following the photo scandal. "Listen," she said, "I don't think I need to defend myself because I am 40 years old, because I am blonde, because I am the wife of Andreas Papandreou." Not that she was any more forthcoming about her intentions. She refused to answer a question about her political ambitions. So is Dimitra Papandreou a bimbo or a ruthless schemer? A devoted wife who nursed one of Greece's pre-eminent post-war politicians back from the brink of heart failure and kept him going against the medical odds, or an ambitious woman who has used her sexual charms to pull the wool over a powerful old man's eyes?
Certainly, she has suffered from the deeply ingrained sexism of Greek society. After the initial shock at their liaison, she bore the brunt of criticism. His public image survived divorce and remarriage virtually unscathed, and indeed there are more than a few Greek men who sneakingly envy him such a catch at such an advanced age.
But she is more than a lightning-conductor for the criticisms Greeks dare not make of the venerable Andreas Papandreou. She has given every indication of knowing exactly what she is doing, and assiduously cultivates the Eva Peron myths that are spun around her.
DIMITRA Papandreou did not enter Greek public life from nowhere. Born Dimitra Liani in 1955 in the Macedonian town of Florina, she comes from a well-connected family. Her father was a distinguished army officer, while her cousin George Liani was the member of parliament for her home town.
Dimitra was hobnobbing in high political circles long before she met Mr Papandreou. Her previous husband, Alexis Kapopoulos, was a prominent member of the Communist Party and they played a full part in the Athens social circuit: parties, cruises and raucous weekends on Aegean islands.
It was, in fact, Margaret Papandreou who first noticed her. She helped Dimitra become a member of her husband's private entourage on Olympic Airways in 1985. She even used her influence to land this enterprising young woman the job of her dreams, her own chat show on television. One of the first guests on Miso miso (meaning "half and half") was the Prime Minister himself. The show was a flop, but the love affair was in full swing.
This was far from the first of Mr Papandreou's marital indiscretions, but Dimitra had the good fortuneto be with him as he fell critically ill in the summer of 1988. When the Prime Minister was admitted to Harefield hospital outside London to have an artificial valve put into his heart, it was Dimitra - not Margaret - who was at his bedside.
Papandreou has often said since that she saved his life. She certainly changed it. After Rhodes she never left his side in public. Even Pasok's defeat in the 1989 elections failed to dent her resolve. One month later she was the third Mrs Papandreou, both bewildered and delighted by the public attention.
Four years of opposition for Pasok were an invaluable apprenticeship for her. Her name dropped out of the papers, and indeed during the 1993 election campaign she barely featured. But once her husband was triumphantly returned to power that changed. Not only did she take control of her husband's private office, controlling access of both people and documents, but she appeared to play a key role in his cabinet appointments.
Her cousin George became sports minister and Mr Papandreou's doctor health minister. By contrast Vasso Papandreou, the feisty former European Commissioner, unrelated to Andreas but widely believed to be an old flame of his, was left out of government altogether.
Extraordinarily, Dimitra's name appeared as number two in the Greek delegation at a European summit in Brussels in December 1993, meaning that she took part in the leaders' closed sessions while the hapless foreign minister, Karol Papoulias, was confined to barracks inside the Greek embassy.
All this earned the First Lady enemies, who have struck back both through the press and by questioning funding of the sumptuous "pink villa" she and her husband have built in a fashionable Athens suburb. Her bid to enter parliament seems unrealistic at this point, particularly as her present office bars her from running for election for three years and the party looks unlikely to grant her an honorary candidacy.
But her ambition is undeniable. On a recent trip to Patmos to mark the 1,900th anniversary of the Revelations of St John, she was seen ruthlessly hogging the limelight as she posed for the cameras next to a reluctant Pope Bartholemew.
A woman with that kind of resolve, and in her position, can go a long way. Mr Papandreou may be weakening physically, but in spirit he is as tough as ever and seems determined to satisfy the whims of his wife. As long as he stays on the scene, she has room to force her imprint on Greek public life. It will take more than a few vulgar pictures in the downmarket press to stop her.