The 64-year-old man found the bewildered bunny last week in the bin by his building in Görlitz - and immediately knew where it had come from, Die Welt newspaper reported on Monday.
It is now being housed in the local animal shelter. The paper said the Görlitz Society for the Prevention of Cruelty to Animals already knew the woman and her husband and had been involved in previous monitoring of the couple with the veterinary inspection office.
When asked about the bunny, the woman allegedly said she thought it was dead - although it seemed perky enough when the neighbour opened the compost bin.
"It would have died a miserable death," Peter Vater, head of the Görlitz Society for the Prevention of Cruelty to Animals, told the paper. Vater added that he expected the family to receive a ban on owning pets, which involves regular monitoring.