A statement issued by his government-in-exile from Dharamshala in northern India, said "it is common knowledge that His Holiness the Dalai Lama has consistently supported the right of China to host the 2008 Olympic Games".
The Dalai Lama called the Chinese official's accusation "highly inflammatory".
The spiritual leader said the Chinese official had quoted from a "distorted interview" with a British television network conducted in January to accuse him of seeking "to sabotage the forthcoming Beijing Olympics".
Cultural autonomy
Referring to questions about whether he backed calls by Tibet support groups for a Games boycott, the Dalai Lama said he had already stated "that it was too radical".
However, the Dalai Lama said Tibet support groups "could remind the international community, including the Chinese people, about the repression and urgency of the situation in Tibet".
The Dalai Lama is frustrated by China's refusal to discuss "cultural" autonomy for Tibet, but sees a window to sway public opinion ahead of the Olympics in August, analysts say.
His statement came a day after Chinese authorities warned preparations had been made to stop campaigners opposed to China's rule of Tibet from protesting in the Himalayan region before and during the Olympics.
Pro-Tibetan independence groups have sought to use the Olympics as a platform to publicise their cause with publicity stunts in Tibet and Beijing.
China has ruled Tibet since 1951, a year after sending troops in to "liberate" the devoutly Buddhist region, and has violently suppressed a number of uprisings since then.
The Dalai Lama, who fled Tibet in 1959 after a failed revolt against Chinese rule, has set up his government-in-exile in Dharamshala.
He has accused China of "demographic aggression," saying his people had been reduced to a minority in Tibet under Beijing's rule.
The spiritual leader also says he wants autonomy for Tibet rather than independence, a demand that China rejects.