"We feel deeply saddened that such a low has been reached," the two princes said in a rare statement.
"Despite the support shown to us and our mother's memory by so many people over the last eight years, we feel that, as her sons, we would be failing in our duty to her now if we did not protect her, as she once did us.
"Therefore, we appeal to all forms of media throughout the world to appreciate fully that publishing such material causes great hurt to us, our father, our mother's family and all those who so loved and respected her."
Milan-based magazine Chi defended its decision to run the photo, which showed Diana slumped and dying in the mangled Mercedes moments after it slammed into a tunnel at high speed, killing her, her lover and their driver.
A spokesman for the magazine said, "There is nothing voyeuristic or disrespectful in all this. It is just an attempt to get closer to the truth of a drama that is still wrapped in too much mystery and too many lies."
British tabloids, which once revelled in covering every twist in Diana's tortured lovelife, had refrained from publishing pictures of her death, maintaining that taboo throughout the nearly nine years since the crash.
Tim Graham / Corbis
"Shame On You" thundered The Sun, which reprinted the photo in Chi but blanked out the image of Diana. "Outrage at Picture of Dying Diana in Magazine," declared the Daily Express.
The fury of the tabloids was ironic to some.
"There is no doubting the double standards of the British media," leading publicist Max Clifford told Reuters. "There is a huge public interest and if they are not horrendous images, I cannot get myself as stirred up as they seem to be."