In the wake of last month's attacks on Paris, Fox News aired reports, later widely derided, that suggested parts of the French capital and Britain's second city of Birmingham were run under Islamic Sharia law.
Steven Emerson has said sorry for his comment, but it was too late to stop the online lampooning.
The City Hall will launch a suit "against persons unknown" for defamation.
City mayor Anne Hidalgo said: "I will not accept insults against our city and its people."
"What's in question here is not fun or... a bad joke, it's lies."
Fox broadcast a map outlining the so-called no-go zones, which a man labelled as an expert, Nolan Peterson, said felt like Afghanistan or Iraq.
Asked last month about the prospect of a lawsuit, Fox News executive vice president Michael Clemente said: "We empathise with the citizens of France as they go through a healing process and return to everyday life.
"However, we find the mayor's comments regarding a lawsuit misplaced."

