The celebrity news website said Lohan wants financial damages from Rockstar Games.
The video game includes a woman resembling Lohan on the cover.
Two episodes in the game also feature women who seem a lot like Lohan. In one, a woman asks a player to help her evade paparazzi and in another, set at a hotel that looks like the Chateau Marmont in West Hollywood, where Lohan once lived, the goal is to photograph a woman having sex.
Lohan, 27, who became a child star at the age of 12 in a Disney remake of "The parent Trap," has become as famous for her personal problems as her career.