Then he confirmed, unapologetically: "Yes, it is Muhammad."
Staff from the satirical newspaper also vowed to continue with their work and confirmed further details of the new edition out tomorrow.
Luzier, who escaped the massacre because he had overslept by half an hour, described crying after he drew the picture.
He said: "We are cartoonists and we like drawing little characters, just as we were as children.
"The terrorists, they were kids, they drew just like we did, just like all children do.
The cartoonist Luz breaks down at the press conference. Photo / AP
"At one point, they lost their sense of humour. At one point, they lost the soul of their child which allowed them to look at the world with a certain distance."
He added: "I'm sorry we've drawn him yet again, but the Muhammad we've drawn is just a little guy who's crying."
Charlie Hebdo's editor-in-chief Gerard Biard told the press conference in Paris that three million copies of the magazine's latest edition would go on sale for two weeks.
New issue drawn in 'pain and joy'
The so-called Survivors' Issue will be translated into three languages - English, Spanish and Arabic.
Biard said the edition had been "drawn up in pain and joy", adding: "We're happy to have got to it and it's been tough."
He said: "The main story was complicated because, of course, it had to say something about us, and it had to say something about the event we were faced with.
"This edition - the whole of Charlie Hebdo is in it. This edition is Charlie Hebdo."
The cartoonist Luz is comforted as he breaks down at the press conference. Photo / AP
Biard thanked the "thousands and thousands" of people who had sent messages of support, including Hollywood stars George Clooney and Arnold Schwarzenegger, who has subscribed to the magazine.
"There will be a future, there's no doubt about that," he said. "We don't quite know precisely what it's going to look like.
"There's going to be a paper. There won't be an interruption. In other words, in two weeks' time, there will be another Charlie Hebdo."
Cover provokes debate
The cover was published last night by the French newspaper Liberation, which has provided a home for the surviving staff under heavy guard.
Within minutes it was circulating around the world on social media and blogs, although for the most part, it was not published by British media.
It was signed by Luz, the same staff cartoonist who drew an image of the Prophet Muhammad on the magazine's cover three years ago, leading fanatics to firebomb the magazine's offices.
Charlie Hebdo
staff grieve and embrace at a rally in Paris. Photo / AP
Luz, real name Renald Luzier, 42, avoided last week's mass murder because he overslept by half an hour and was late for work.
The cover's release came after the magazine's lawyer Richard Malka said the new edition would "of course"' contain images of the prophet Muhammad, who Islamic codes dictate should not be depicted.
"We will not give in," he told a radio station. "The spirit of 'Je Suis Charlie' means the right to blaspheme.
"We will not give in otherwise all this won't have meant anything. A Je Suis Charlie banner means you have the right to criticise my religion, because it's not serious.
"We have never criticised a Jew because he's a Jew, a Muslim because he's a Muslim or a Christian because he's a Christian.
"But you can say anything you like, the worst horrors - and we do - about Christianity, Judaism and Islam, because behind the nice slogans, that's the reality of Charlie Hebdo."
Fears of further attacks
But while the decision has won praise from many for its courage in the face of extremism, it has drawn condemnation from others who fear it will only serve to incite further attacks.
One of the surviving members of Charlie Hebdo's staff said the cover should help "open the door to forgiveness" for the terrorists who killed her colleagues.
Zineb El Rhazoui insisted the team did not feel hatred towards the men and recognised that "the struggle is with an ideology" as she spoke of the difficult task of injured and traumatised staff pulling together the issue.
And she said putting a cartoon of the prophet Mohammed into three million homes was an important way to show the spirit of the slain Charlie Hebdo journalists would not be silenced.
Ms El Rhazoui - who was overseas on holiday at the time of the attack on an editorial meeting - said the staff were "proud" of what they had produced in such difficult circumstances.
Asked to whom the headline was addressed, she told BBC Radio 4's Today: "It is addressed to us because we feel we have to forgive what happened.
"I think those who have been killed, if they had been here they would have been able to have a coffee today with the terrorists and just talk to them, ask them why they have done this.
"We feel as the Charlie Hebdo team the need to forgive the two terrorists who killed our colleagues. We cannot feel any hate towards them.
"We know that the struggle is not with them as people but the struggle is with an ideology."
She went on: "This mobilisation here in France after this horrible crime is something that must open the door to forgiveness and everyone must think about this forgiveness.
"We, as the Charlie Hebdo team, need to forgive."
Cover part of 'ideological struggle'
British Deputy Prime Minister Nick Clegg also defended the cover as part of an "ideological struggle" to maintain a free society and suggested he could be among those snapping up a copy of the magazine.
"I'm not sure I'm going to buy it, but I would defend the right to publish a cover like that," he said.
"I don't think you can have freedom unless you are also free to offend each other in an open society."
London's mayor, Boris Johnson, said the staff had "no choice" but to print such a cover.
The Conservative MP said: "You cannot have a march through the streets of Paris attended by 46 world leaders, four million people, climaxing with a shout of 'We are not afraid' and then not print the central object of contention.
"Of course they are right to do that and I am afraid it is absolutely vital now that everybody stands up and defends their right to publish.
"You may not agree with what they have done, you may be offended by what they have done, but you should defend their right to publish it."
However, Muslim British Labour MP Khalid Mahmood warned that people who were offended by the anti-Islam cartoons were "helpless" to do anything about it.
He told BBC Radio 4: "I think in relation to the cartoons and freedom of expression, liberty, I don't think we have that at all at the moment - we don't have it in terms of gender, we don't have it in terms of sexuality, in terms of race, in terms of anti-Semitism.
"So to put this smokescreen up, I don't think it's valid."
He said that the cartoons would be used extremists as a "recruiting sergeant" to "create havoc" in the future.
French Muslims' disgust
French Muslims, who make up a community of more than five million across the country, also expressed their disgust at the cover.
They have suffered up to 50 "revenge attacks" since the terrorists struck, including shots and dud grenades being aimed at mosques.
Jamel Boukhlef, a 24-year-old worshipper at the Grand Mosque of Paris, said: "It's not funny, and unpleasantly provocative considering all we've been through over the past few days.
"Depictions of the prophet like this are blasphemous - they are clearly designed to bait Muslims."
Leila Souissi, a 38-year-old mother of four, said: "There are strict laws in France against anti-Semitism and stirring up religious hatred, yet that's exactly what this magazine is going to do.
"What happened to the magazine staff is pure evil, and all of us condemn it, but publishing horrendous cartoons like this just keep the confrontation going."
Such Muslims also found an unlikely ally in Marion Marechal-Le Pen, the National Front MP who is the granddaughter of the far right party's founder, Jean-Marie Le Pen.
Ms Marechal-Le Pen said: "If being Charlie means defending liberty of expression, then I'm Charlie.
"But if it's about defending their editorial line, then I don't feel obliged to buy it."
Muslim leader says cartoon 'problematic'
Meanwhile, Omer El-Hamdoon, from the Muslim Association of Britain, said there are two aspects of the front cover which will offend Muslims - the actual depiction of Muhammed and then the satire element.
"Because he is held in high esteem, we find that any sort of publishing of cartoons would not really be suffice to present the person he is.
"And this becomes more problematic when the actual cartoon is actually out there to offend people, to actually make a satire out of this image," he said.
International broadcasters and publishers were this morning also faced with deciding whether to replicate the controversial cover.
The Guardian was among those to carry the front page on its website, while The Telegraph cropped part of the design to remove the depiction of Islam's prophet.
Others, including Sky News, chose not to repeat the image.
Up to three million copies of Charlie Hebdo - whose usual circulation is 60,000 - will be printed on Wednesday.
An initial batch of one million copies will be available on Wednesday and Thursday, said Michel Salion, a spokesman for MPL, which distributes Charlie Hebdo.
A further two million could then be printed depending on demand.
"We have requests for 300,000 copies throughout the world - and demand keeps rising by the hour," he said, adding that the newspaper usually had just 4000 international clients.
"The million will go. As of Thursday, the decision will probably be taken to print extra copies ... So we'll have one million, plus two if necessary."
Other religions to be lampooned
The new edition of Charlie Hebdo will also make fun of politicians and other religions. Brothers Said and Cherif Kouachi, shot dead after a two-day manhunt, chose the publication as the target of their attack last week after it repeatedly published cartoons of Muhammad.
Some Muslims find depicting the religious figure deeply offensive, and many Western media organisations choose not to do so on that basis.
Charlie Hebdo deliberately broke that convention. It once renamed itself 'Sharia Hebdo', claimed to be guest edited by the prophet and carried the cover slogan "100 lashes if you don't die laughing".
Their offices were burned down after a petrol bomb attack in 2011, believed to be connected to those images, though on that occasion nobody was hurt.
Editor Stephane Charbonnier, who was among the nine magazine staff to be shot dead last week, was also placed on Al Qaeda's most wanted list last year.
- Daily Mail
