The New York Post said the lawsuit pertaining to the popular Super Bowl advertisement was filed Monday and accuses the financial company of using Lohan's "name and characterization" without compensating her or getting her approval.
The commercial shows one baby girl accusing a boy of two-timing her with a "milkaholic" named Lindsay. Another baby girl, apparently the Lindsay in question, is then seen slurring the words, "Milk-a-what?"
"Many celebrities are known by one name only, and E-Trade is using that knowledge to profit," the Post quoted Lohan's lawyer, Stephanie Ovadia, as saying.
"They used the name Lindsay," she added. "They're using her name as a parody of her life. Why didn't they use the name Susan? This is a subliminal message. Everybody's talking about it and saying it's Lindsay Lohan."
Ovadia is demanding the commercial be taken off the air and the company pay her client $100 million in damages.
The Post said E-Trade couldn't be reached for comment, but the producers of the ad said the baby was named for someone on the account team.
Lohan is a former child star whose career has been eclipsed in recent years by her legal troubles and battle with substance abuse.