In the story, published on Thursday (01Nov12), the magazine reported that Bynes caused "quite a scene" during a recent visit to Beach Bum Tanning in the Big Apple when she shocked customers by walking through the main salon area naked.
A source told In Touch reporters the Hairspray star purchased a spray-tan session and was set up in a private room - but she left and started walking around the salon "in search of goggles".
The source said, "She walked out of the room completely naked. She didn't seem to care that everyone saw her naked. She seemed totally out of it."
But Bynes, who is currently facing a string of legal issues in Los Angeles following a series of 2102 traffic offences, has moved swiftly to deny the reports, stating, "That's not true, I'll sue."