The football federation (RFEF) "roundly dismissed" the story on Brazilian sports portal GloboEsporte.
In the 'exposé', the wesbite claimed Spanish footballers and a member of the team's technical support unit celebrated their June 17th victory over Uruguay by engaging in a night of high jinx at the Golden Tulip hotel in the Brazilian city of Recife.
GloboEsporte said the Spaniards held a private party in the establisment with music, caipirinhas, beer and women".
Towards dawn, a group of five women went back to the players' rooms, according to the sports site.
The portal also cited workers and security staff to back up its claims that the Spaniards indulged in a game of strip poker.
But Spain's football federation have slammed the story, Spanish site 20minutos reported on Tuesday.
"We don't even want to give any credit to the story by responding," said Antonio Bustillo, spokesperson for the RFEF.
The hotel manager, meanwhile, labelled the story "a hoax", and blamed rivals of Spain for the night-long party.
Several days earlier, GloboEsporte had also published a story claiming money had been stolen from Spanish footballers staying at the Recife establishment.
The hotel, however, said the claims were completely false.
"The hotel didn't receive any complaints from the Spanish team about this or any other incident," said the hotel
But the local Recife police force has decided the investigate the claims of theft anyway.
Speaking to GloboEsporte, one of the city's top cops said the case was one for the city Tourism Commission.
"The commissioner went to the hotel, collected forensic evidence and heard the evidence of 27 people," said the policeman.
He said authorities still wanted to hear from Spain's footballers in relation to the incident.
Spain will face Italy in the semi-finals of the Confederations Cup in what is a rematch of the UEFA Euro 2012 final which Spain won 4–0.