O'Neill revealed that the Reds have an offer for Barry, but the England midfielder is not willing to discuss it before the end of the season.
Apart from approaching his star man, O'Neill was disappointed that the bid is being talked about in public, ahead of Villa's season finale.
"I think that what we had, was that I thought Gareth said he would prefer to wait until the end of the season before discussing things and I think that is right to do so," he told Sky Sports News.
"It is particularly disappointing to find out that Liverpool, I think, have carried the story in their local paper - it is certainly not the way the Liverpool of old would have conducted business.
"I prefer to do it in a bit of privacy with a bit of confidentiality and it is disappointing especially at this time with two games to go."
Exchange
The Scotsman also implied that the offer is a part-exchange deal, and earlier speculation suggested that Peter Crouch could be the Liverpool player to depart.
"They haven't made a straight cash offer, they have made a mish-mash of nameless players in exchange," he added.
"As I said I am particularly disappointed to find our business being conducted in public.
"I want to be clear, I want to build a club here, we are not a feeder club - we want to try to challenge, at some stage, we want to get to the position that this club once held [European champions] and this demands an awful lot of effort.
"I don't want to be in the position of letting players, really good players go and Gareth Barry is a really good player who still has two years left on his contract."