Potiphar treats Joseph kindly at first, and is a good master to his slaves. He is, however, a bit gullible since he believed his wife when she lied about Joseph trying to rape her. At first, he is angered by Zuleika's lies, but when she intervenes he more or less realizes what really happened.
He seems to be quite selfstrict, as he focuses a lot of his attention on keeping his reputation clean. This can be seen when he very nearly buys a horse from a false seller who tries to swindle him for a lot of money. The seller offers him his entire stable of horses as a compensation, but Potiphar rejects his offer and orders him arrested. This is again seen when he first orders Joseph to be executed after his wife claims to have been raped by Joseph. But as his wife intervenes, he realizes what actually happened, but having a reputation at stake, he changes the sentence to life in prison and Joseph is sent to prison.
Role in film
Potiphar is Joseph's slave master and later friend. When his cruel wife Zuleika lies to him that Joseph tried to rape her, he is very angry and orders Joseph to be executed. However, Zuleika intervenes and Potiphar more or less realizes the truth. Instead, he has Joseph thrown into prison. Later, he is ordered by the Pharaoh to let Joseph out of prison. He apologizes to Joseph and is forgiven. He then presents him to the Pharaoh. He is also present at Joseph and Asenath's wedding. Potiphar is later seen helping take care of the land during the seven years of abundance, and recording the people taking grain during the seven years of famine. Potiphar is also in the scene where Joseph and his brothers reconcile.
In the Bible, Asenath was actually his daughter rather than his niece. In the movie, it's never explained how Asenath is his niece; like, if she's actually related to him or if she's only his niece by marriage (Asenath could be the daughter of the sibling of his wife).