The Academy Award-winning actress, who uses a wheelchair now because of back problems, was asked about the reports during an appearance on CNN's "Larry King Live."
"Oh, come on. Do I look like I'm dying?" the 74-year-old Taylor asked King. "Do I look like or sound like I have Alzheimer's?"
Taylor said tabloids report such things "because they have nothing else dirty to write about anybody else."
The June 5 issue of The National Enquirer carries the headline "Liz Alzheimer's Tragedy." The story states that Taylor was being treated for the early stages of Alzheimer's. Citing an unidentified source described as a longtime friend, the story says that during a hospital visit doctors found she was "slipping mentally."
"Let's clear up some things, a lot of tabloid stories about you," King said during the TV interview.
"Oh my God, am I dead, am I alive?" an exasperated Taylor replied.
Asked about the attribution of the Alzheimer's story, she said, "Do you think any friends of mine would say things like that?"
King also noted that she used a wheelchair.
"What's the reason for that?" he asked.
"My back, which has been chronically bad since I was a teenager," she said.
Taylor said she was born with the spine curvature disorder scoliosis and has osteoporosis.
When asked about charges that her friend Michael Jackson molested a boy in 2003, Taylor said, "I've never been so angry in my life."
Jackson was acquitted of the child molestation charges last year.
She defended Jackson's slumber parties with children at his Neverland ranch.
"I've been there, when his nephews were there, and we all were in the bed, watching television," she said. "There was nothing abnormal about it. There was no touchy-feely things going on. We laughed like children, and we watched a lot of Walt Disney. There was nothing odd about it."