McCain launched a broadside against Steinmeier, accusing him of being "in the Neville Chamberlain school of diplomacy" for not toughening Berlin's stance on Russia's interference in Ukraine.
"The foreign minister of Germany is the same guy that refuses - and his government - to enact any restrictions on the behaviour of Vladimir Putin, who is slaughtering Ukrainians as we speak," McCain told reporters.
"He doesn't have any credibility in any way to me."
"This is not just an issue of American domestic politics, but it affects the negotiations we are holding in Geneva," Steinmeier told journalists in the US capital before meeting lawmakers on Capitol Hill.
"Obviously mistrust is growing... on the Iranian side if we are really serious with the negotiations."
Steinmeier added it would be good "if the letter of the 47 senators no longer causes any disturbance in the negotiations."
The Foreign Minister complained that the move, which has been condemned by Obama, Vice President Joe Biden and several Democratic congressional leaders, could jeopardize the Western position in the nuclear talks.
The letter allows Iran to cast doubt on the West's credibility, Steinmeier said at an event organized by the Center for Strategic and International Studies, a Washington think tank.
"This is not a trifle," he stressed. "The negotiations are difficult enough, so we didn't actually need further irritations."
The Republican intervention has caused rifts in the party, with Senate Foreign Relations Committee chairman Bob Corker and six other Republicans refusing to sign on, arguing it was not the appropriate avenue for influencing the deal.
McCain, acknowledging the blowback over the letter, said this week the effort should have been more carefully considered.
But on Thursday he insisted he was "glad to have signed it" and accused Obama of provoking it by threatening to veto legislation requiring congressional approval of any Iran nuclear agreement.
The German diplomat met Thursday with Corker and the panel's top Democrat, Senator Robert Menendez, who told AFP afterwards that he agreed that the "partisan letter" could complicate the delicate talks.
Germany is part of the so-called P5+1 group - along with the United States, Britain, France, China and Russia - that seeks an agreement with Iran to rein in the Islamic republic's controversial nuclear program.
"Iran's path to the nuclear bomb must be blocked in an unambiguous, verifiable and durable way," Steinmeier said late Wednesday before meeting US Secretary of State John Kerry for a working dinner.
Iran says its aims are entirely peaceful.