Mueller, 59, added that handing the prize to the vice-chairman of the government-backed China Writers' Association, while 2010 peace laureate Liu Xiaobo remains in jail, was "a slap in the face for all those working for democracy and human rights.''
Liu is serving an 11-year prison term for subversion after he called for democratic reforms to China's one-party system.
The day after his prize was announced, Mo Yan told reporters that he hoped Liu could be released from prison "as soon as possible.''
"He should have said that four years ago, or at least two weeks before receiving the prize,'' Mueller said.
Mueller was persecuted by Romania's Communist-era secret police for refusing to become an informant, and her work was censored at home. She emigrated to Germany in 1987.
Her novels, notably The Appointment and The Land of Green Plums, describe the terror and humiliation she said she suffered under Nicolae Ceausescu's regime.
- AAP