The disgraced financier was sentenced to 150 years in jail in June (09) after he pleaded guilty to siphoning billions of dollars from his wealthy clients, including Kevin Bacon, Kyra Sedgwick, John Malkovich and Zsa Zsa Gabor.
He is currently serving his time in Butner, North Carolina and was alleged to have taken full responsibility for the scheme as he knew he was suffering from advanced cancer.
A source told the New York Post that Madoff had to take "20 pills a day" to battle the effects of the disease, adding that "he's not doing very well".
But officials at America's Prison Bureau insist the article is "full of inaccuracies" and Madoff is not battling the illness.
A representative says in a statement, "We can tell you that Bernie Madoff is not terminally ill and has not been diagnosed with cancer."