• The niece of a long-dead priest is suing to block the sale of one of Judy Garland's iconic "Wizard of Oz" frocks that was missing for decades.
• She says the valuable piece of Hollywood memorabilia belonged to her late uncle.
• The blue and white gingham dress is slated to be sold at auction on May 24 and could snare anywhere between $800,000 and $1.2 million, Bonhams New York said.
• The Catholic University of America in Washington, D.C., which found the dress and which put it up for auction, is a defendant in the Manhattan federal suit by Barbara Hartke, the priest's niece.

Forget the ruby slippers. Dorothy's dress is now the most contentious piece of clothing in the Land of Oz.

The niece of a long-dead priest is suing a New York auction house to block the sale of one of Judy Garland's iconic Dorothy frocks from the 1939 classic film "The Wizard of Oz."

The dress was missing for decades before it was found at a Catholic university last year. The priest's niece, Barbara Hartke, says the valuable piece of Hollywood memorabilia belonged to her late uncle.

The blue and white gingham dress, believed to be one of six original dresses from the film is slated to be sold at auction on May 24 and could snare anywhere between $800,000 and $1.2 million, Bonhams New York said.

The dress was a gift from Mercedes McCambridge, an Academy Award-winning actress and friend of Garland's who was artist-in-residence at The Catholic University of America in Washington, D.C., between 1972 and 1973, to Dominican Father Gilbert Hartke, founder of the school's drama department. (McCambridge, incidentally, is known for providing the voice of the demon in 1973's religious-horror classic "The Exorcist," which was shot and set in D.C.)

However, after Gilbert Hartke died in 1986, no one knew what had become of the costume and it was considered lost. In June of last year, the dress was found in a white trash bag above the faculty mail slots during a renovation of the university's Hartke Theater.

While Catholic University has claimed ownership of the dress, Hartke's 81-year-old niece argues that the dress belongs to his estate because McCambridge "specifically and publicly" gave it to Gilbert Hartke.

Barbara Hartke, who lives in Wisconsin, named the university and the auction house as defendants in her lawsuit, which was filed Tuesday in Manhattan federal court.

The suit seeks an injunction from the court that would prevent the auction from taking place.

"The University is reviewing the allegations made in the lawsuit at this time and will provide additional information after a thorough review of the complaint," said a spokesperson for the school.

A representative for Bonhams did not immediately respond to CNBC's request for comment.

— CNBC's Dan Mangan contributed to this report.