|Yudhoyono was elected in 2004, largely on a campaign to root out entrenched corruption and nepotism [EPA]
Leaked US diplomatic cables implicate the Indonesian president in corruption and abuse of power, according to Australian media.
The documents, obtained by WikiLeaks, contain claims that Susilo Bambang Yudhoyono has been trying to influence judges and prosecutors to protect allies from prosecution, The Age reported on Friday.
Reports citing the cables also said Yudhoyono has used the country's intelligence service to spy on political rivals and a senior minister in his own government.
Other allegations attributed to the cables are that Yudhoyono's former vice-president paid millions of dollars to buy control of Indonesia's largest political party and that the president's wife and her family were seeking to enrich themselves through their political connections.
Marty Natalegawa, Indonesia's foreign minister, said at a news conference that the claims were baseless.
"We find it especially unacceptable that it has been suggested as facts," he said.
The US ambassador to Indonesia expressed regret that the cables - apparently written by his predecessor - had found their way to the public but could comment little on their contents.
Information exchanged between the embassy in Jakarta and Washington is "preliminary, often incomplete and unsubstantiated," Ambassador Scot Marciel told reporters.
"This is not an expression of policy, not of our final decision," he said. "These documents should not be seen as ... representing the US policy."
Yudhoyono became the country's first directly elected leader in 2004 largely on a campaign to root out entrenched corruption and nepotism following the 32-year dictatorship of General Suharto. He was re-elected in 2009.
Al Jazeera's Step Vaessen, reporting from Jakarta, described the reported cables as "very damaging" for the president.
"According to those cables, American diplomats think that he actually protected a political figure who happens to be the husband of the former president from going to jail for corruption, and the same person is now heading the People's Assembly," she said.
"This is something anti-corruption activists have said for a while, that mostly the "middle people" go to jail for corruption but the big fish, like this person, always escape."
Yudhoyono is credited by many with bringing political stability and economic reforms to the country of 237 million, but millions of Indonesians still live in poverty, the country's infrastructure is poor and graft remains widespread.