Sri Lanka's star spinner Muralitharan was not given a place in the Test Team of the Year announced at the inaugural awards of the International Cricket Council (ICC), but the man who is trailing him, Australia's Shane Warne, was included.
"You expected better from a respected panel of judges," Ranatunga said on Thursday. "They said they looked at the performance of players in the past year, but that does not appear to be the case."
"This is a farce. It is a joke to leave out Murali and give an award to Shane Warne. People will have doubts about (the credibility of) the ICC. The performance of Murali in the past year was far ahead of Warne."
Ranatunga, who led Sri Lanka to World Cup victory in 1996 and is now deputy minister of tourism, said he believed the ICC selections had been "very biased".
The only Sri Lankan to make it to the ICC Test Team and the One-Day squad was paceman Chaminda Vaas.
Muralitharan said he believed he was left out of the ICC Test Team of the Year because of his controversial bowling action.
Affectionately known as Murali, he took 68 wickets in eight matches during the course of the voting period at an average of 17.47, but failed to make the team with the spinner's spot going to Warne.
Warne only played half the year after finishing his 12-month ban imposed for failing a drugs test on the eve of the last World Cup.
"A few people are not that keen on me because they think I am not bowling properly," said Muralitharan who holds the world record for Test victims with 532 wickets, five ahead of second-placed Warne.
"That's the only reason it can be, but it's disappointing for me."
"It happens sometimes that people are not favourable towards me but they do not have to judge that - they have to judge how I have performed during the course of the year," the Sri Lankan told the BBC.
"I am surprised that someone who didn't play for six months did get into the side.
"If you take Warne's total career he should be there, but if it's about one year's performance he should not because he did not play for six months of that time.
"I don't need more awards - I already have the world record but I was disappointed."
Defending the decision, the selection panel chairman Richie Benaud said: "Warne came back and made an immediate impact with 36 wickets in just five games and deserved his place as the first spinner.
"Leading wicket-taker Muralitharan was unlucky."