The supremo's sibling, also known for being the publisher of right-wing newspaper Il Giornale in Italy, made the controversial remark during a rally led by the former Prime Minister's People of Freedom political party in Lombardy.
And after addressing members of the public in the audience, he encouraged them to attend Milan's match against Udinese at San Siro - which the Rossoneri eventually won 2-1 courtesy of goals from the striker, who is partly of Ghanaian descent.
"Let's go and watch our household's little n***** [playing]," he said to laughter, according to La Repubblica.
"The girls here are all invited as well. They have the chance to meet with Silvio Berlusconi."
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Another race controversy could be about to boil over following last season's factions in the Premier League which saw Luis Suarez and John Terry garner negative press for their alleged discriminatory acts towards Patrice Evra and Anton Ferdinand.
More recently, Balotelli's Milan team-mate Kevin-Prince Boateng halted a friendly match against Pro Patria after being racially abused by the Lega Pro side's supporters.
Balotelli completed a January deadline-day switch to Milan for a reported €22 million (£19m), but it is claimed that his former club Manchester City have first refusal on the attacker if he decides to move on again.