Peru has recalled its ambassador in Mexico indefinitely after Mexico's president said Peru's government was "unconstitutional".
Andres Manuel Lopez Obrador also said that Peru's former president, Pedro Castillo, had been "illegally ousted."
Peru's current leader Dina Boluarte denounced what she said was "unacceptable" interference in its "internal affairs".
She said the remarks would seriously affect relations between the nations.
Pedro Castillo's expulsion in December sparked mass protests which are continuing across the country, and have seen at least 50 people killed.
The 53-year-old is currently in prison facing charges of rebellion and conspiracy after he unsuccessfully tried to dissolve Congress in order to stop an impeachment vote against him.
Ms Boularte, who was Mr Castillo's vice-president, has so far withstood repeated calls from protesters for her to stand down and make way for constitutional reform.
Speaking on Friday she accused her Mexican counterpart of supporting what she has described as an attempted coup by Mr Castillo.
"Mr Lopez has decided to seriously affect the bicentennial relations of mutual respect, friendship, cooperation, and desire for integration that have historically united Peru and Mexico," she said.