The Absolutely Fabulous star was sharing a meal with fellow comedienne Roseanne Barr when the country legend joined them during a discussion about body art.
Parton confessed she has several inkings on her chest - and she left Saunders and Barr open-mouthed by unzipping her top and showing off her breasts.
Saunders tells U.K. talk show host Graham Norton, "I was in a restaurant with Rosanne Barr. Dolly was there and talking about tattoos. She winked at us and said, 'This will go no further' and then undid her top and there were her t**s and she has the most exquisite tattoos - angels and butterflies.
"They are the most divine, Titian like drawings... I kid you not. Although I did wake up in the morning and thought that couldn't have happened. But it did. It was one of the strangest evenings ever."