Balan plays tragic South Indian actress Silk Smitha, who made her name in controversial 1980s films.
Luthria told The Times of India: "I was obsessed with the idea of having Vidya Balan in the lead role. When I met her, I was assured that I have made the right choice. Not only is she a great actress, she has a unique sex appeal.
"And I was looking for this combination in my leading lady. Vidya Balan has the voluptuousness of actresses like Sridevi and Vyjayanthimala, which we don't see in the present lot."
Luthria added: "I told Vidya that it was more my responsibility than hers to ensure that her performance comes out beautifully. It didn't matter whether she looked raunchy; she had to look erotic and sensual."
Balan reportedly suffered exhaustion on the set of The Dirty Picture because of the demanding production schedule.
She has since described her role in the film as the "toughest" of her career.