The 56-year-old, wearing fancy dress, mocked left-wing progressives in Berlin who were promoting gender-neutral bathrooms as the “latte macchiato” faction.
Such toilets were for “men who cannot decide if they want to sit or stand when they pee”, Ms Kramp-Karrenbauer said.
Her remarks have provoked a volley of rebuke, including from the deputy mayor of Berlin, Klaus Lederer, who called the footage of her joke a “travesty”.
Political figures caricatured at German carnival
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“The chair of the largest party in the Bundestag finds it funny to denounce people who do not correspond to the macho norm,” he tweeted.
The leader of the opposition Left party, Dietmar Bartsch, also condemned Ms Kramp-Karrenbauer.
Her comments were “another reason to fight against this woman becoming chancellor”, he said.
Another politician, Jens Brandenburg from the sometime-coalition partners of the CDU, the Free Democrats, said the chancellor-to-be’s joke was “embarrassing” for Germany.
“Is it so difficult to make a humorous joke without attacking minorities?” he tweeted.
Despite the criticism, Ms Kramp-Karrenbauer’s punchline – which was also broadcast live on a public TV station – provoked storms of laughter from her carnival audience.
The politician’s routine came as part of the German tradition of carnival, which hits a peak before Lent begins on Ash Wednesday.
It is common during the festivities for elaborate floats to poke fun at politicians and for some lawmakers to deliver satirical speeches.
One CDU MP, Johannes Steiniger, has defended his leader, attacking what he called a “culture of outrage” over a harmless carnival speech.
The carnival joke is not the first time Ms Kramp-Karrenbauer has come under fire over LGBT+ issues.
A lifelong Catholic, she was named “Miss Homophobia 2018” by the Enough Is Enough pro-LGBT+ advocacy group after an online vote.
She also famously criticised gay marriage in 2015, arguing that if marriage was opened up to same-sex couples it could also be made available to incestuous or polygamous relationships as well.
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