The picture was posted along with a news release promoting the official opening of a new highway last Thursday.
It showed school children on a road in Pennfield, N.B., some of whom were holding Canadian flags, but in the background there were several blurry protest signs partially removed.
The government took down the photo Wednesday and posted a note online saying it was uploaded in error.
The government said it was altered by an outside photographer but should not have been, and it apologized.
The Maritimes director of the Canadian Union of Public Employees says 20 protesters with Local 963 were at the site waving signs opposing the closure of two NB Liquor outlets in the province.
Gordon Black says he would like to know who doctored the photo and why it happened.
"It's totally wrong. No government, company or union can airbrush photos and call them originals ... Whoever it was, it's absolutely wrong," he said.
"I want to make sure it never happens again."
The original event was announcing the opening of the $540-million highway between St. Stephen and River Glade.