Bruno Cautrès, of the centre for political research at Sciences Po, said the party was undergoing a "crisis of Marine Le Pen's leadership".
"You fight for your country and they call you racist. Wear it as a badge of honor".
At a news conference following his speech, Bannon gave his explanation for the recent high-profile staff departures from the White House. She said it was important to hear the ideas of a man who was "the architect of Donald Trump's victory" and has written about globalization and giving to regular people "power, which in his mind and mine, too, has been practically illegally captured by the elite".
Bannon added that the pivot was partly in order to prepare for the upcoming midterm elections.
The outcome of Italy's election last week has energised France's far right after the Five Star Movement and the anti-immigration League beat the traditional parties.
Founded by Le Pen's father, Jean-Marie Le Pen, in the 1970s, the National Front plans to change its name via a vote on Sunday.More news: Miami's Mokai Nightclub Loses License After Video Shows Horse Inside Club
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She has long sought to "de-demonize" the party by moving away from its racist past, but Le Pen's own father complained that Bannon was the "most radical" of Trump's advisers, saying Saturday's invitation "is not exactly the definition of 'de-demonization'". Let them call you nativist.
Le Pen is seeking to make over her struggling party after her failed presidential bid a year ago.
The changes pave the way for a younger leadership circle to emerge, even if the party's ideological foundation remains unchanged: nationalist, identity-driven, anti-European Union, according to Jean-Yves Camus, an expert on the far-right.
In a surprise appearance on Saturday, former Trump adviser Steve Bannon addressed France's far-right National Front, telling a gathering of the party that they are "part of a worldwide movement that is bigger than France, bigger than Italy, bigger than Hungary - bigger than all of it. Because everyday we get stronger and they get weaker".
The National Front has never won the French presidency, and the congress in Lille is aimed at remaking its image after Le Pen's crushing defeat to independent, pro-globalization Emmanuel Macron in last year's presidential election.
Bannon met Marion, who temporarily withdrew from politics after her aunt's presidential election defeat last May, at the CPAC conservative conference in Maryland last month, where he said she was "absolutely electrifying".
But Bannon might have threatened Le Pen's makeover with his compliments for an extreme version of the National Front and lavish praise for Le Pen's more hard-line niece and rival.