An agitated Rob Ford addressed the allegations briefly at a news conference Tuesday honouring former boxing champion George Chuvalo, blasting the Toronto newspaper that published them for what he called its "relentless" attacks against him.
"It's an outright lie," he said.
"It's the Toronto Star going after me again and again and again."
The Star reported Ford was asked to leave the Garrison Ball, which raises money for the Wounded Warriors charity, over concerns he was intoxicated.
The paper said its report is based on interviews with several organizers and guests, all of whom requested anonymity.
It also said current and former members of Ford's staff have described a longtime battle with alcohol abuse and a failed attempt to get the mayor into rehabilitation treatment.
A city councillor, Paul Ainslie, told the Star that Ford was asked to leave the gala, but wouldn't say why. One unnamed organizer said it happened because "he seemed either drunk, high or had a medical condition."
But Defence Minister Peter MacKay said in an email that he spoke briefly with Ford at the event and that "he looked fine to me."
Ford's spokesman George Christopoulous also said the mayor "was never asked to leave the gala."
Toronto Star editor Michael Cooke stands by the newspaper's report.
"If we're lying it means six or seven other prominent people at that dinner are lying as well. Is he calling them liars?"
Cooke said the story is based on several sources, many who came from Ford's inner circle and contacted the paper out of concern for the mayor.
And he flatly denied Ford's claim the paper is out to get him.
"We've covered him the way we would cover any mayor," Cooke said.
Deputy Mayor Doug Holyday says no one has ever approached him with concerns over Ford drinking, and suggests the accusations are part of a broader scheme to discredit the mayor.
"There are people that do not like our agenda... We're not going to be curtailed by those people," he told reporters Tuesday.
"They can't seem to stop us politically, they're going to try to stop us in another way," he said.
The mayor's brother, Coun. Doug Ford, denied his sibling has a drinking or drug problem, telling Toronto radio station AM640 that he's "never seen Rob drink at any event. Ever."
Asked if his brother would sue the paper over the report, the councillor said a court case would only generate more media attention.
Experts in politics and public relations say this latest controversy is not likely to cause supporters of the mayor to shy away from him.
"I don't think it's a simple question to just say, 'Oh you know the guy's an embarrassment I'm not going to support him anymore,'" said Ryerson University Professor Neil Thomlinson.
Thomlinson said in his view a viable right-wing alternative mayoral contender would need to emerge before the so-called "Ford Nation" of hard-core supporters would consider jumping ship.
Marketing professor Monica LaBarge of Queen’s University agrees the latest allegations won’t likely change the general public’s mind.
“Mayor Ford is such a polarizing figure. So for the people who hate him, these allegations of drinking too much are just one more reason continue to hate him. The people who love the mayor haven’t been swayed by the negative press in the past, so their opinion is likely to remain unchanged,” said LaBarge.
The matter stirred heated discussions online, with observers on both sides voicing their opinions on Twitter.
"After all the left has put Ford through, I can see why he would drink. Also if true he should be helped," one wrote.
"Mayor Rob Ford keeps adding to his list of disgraces!," read another message.
The latest allegations surfaced just weeks after the mayor was accused of inappropriately touching a former political foe at a political event.
Sarah Thomson said Ford appeared out of it at the time and suggested he has a substance abuse problem, but the mayor denied the incident occurred.
--With files from Will Campbell