Michael Russell told the Scottish Parliament the salary increases - revealed by The Herald earlier this week - should be in step with what other staff were being offered.
Mr Russell was responding to concerns raised by Labour MSP Ken Macintosh after figures showed almost half of Scotland's university principals took increases above inflation. One was as high as 24%, although others accepted no rise or just 1%.
The controversy comes at a time when university and college staff are taking industrial action over a 1% pay offer for last year.
Mr Russell said: "I do not support or endorse what has happened.
"If principals, as they do from time to time, ask for my private advice on what they should do, my advice is unequivocal - they should do what ministers in the Scottish Government have done, they should do what has been done right across the public sector, they should make sure they show restraint and leadership.
"They certainly should not allow themselves to be awarded pay increases massively out of step of those salary terms and conditions that are being offered to their staff. I can't be any clearer than that."
Mr Macintosh said people were outraged by the large pay increases.
He said: "To hear Mr Russell's private advice when we're talking about public funds is not acceptable to this Parliament.
"This is a public matter. We're talking about half a billion pounds of public money going to these institutions."
However, Labour should table plans to "nationalise" universities if they want ministerial intervention, Mr Russell suggested.
On Monday, Scottish university principals were accused of hypocrisy and greed after figures showed nearly half of them accepted inflation-busting pay rises last year.
Academics and student leaders called for legislation to restrict pay for senior managers in the sector after an average increase of more than 4% in 2012/13.
The figures show the largest rise was a 24% rise for Professor Steve Chapman from Heriot-Watt University, Edinburgh.
Mr Chapman accepted a £20,000 increase in his basic pay and a £20,000 bonus in 2012/13 to bring his overall salary package, excluding pensions contributions, to £210,000.
There has been a concerted drive in Scotland in recent years to obtain more clarity and accountability over the salaries of university principals, which has been resisted by institutions.
In 2012, a review of university governance chaired by Professor Ferdinand von Prondzynski, principal of Robert Gordon University in Aberdeen, called for a number of changes, including the abolition of bonuses.
It also called for university remuneration committees that set the pay of principals to include members of staff and students to increase transparency.
However, a new code of governance published by a steering group of experts chaired by Lord Smith of Kelvin later dismissed the suggestion, arguing principals' pay should continue to be decided by the current remuneration set-up.
A spokeswoman for Universities Scotland, which represents principals, said: "We expect principals' salaries to come under intense scrutiny, but it's important to give the figures some context.
"Principals are in charge of multimillion-pound enterprises and responsible for many thousands of staff and students and hundreds of stakeholders. It is a complex and demanding job which commands a high salary."