"No, it is not true," Ranjith tweeted when asked about it by a fan.
Deepika played the leading lady in Rajinikanth's "Kochadaiyaan", India's first photo-realistic motion-capture film, which marked the directorial debut of Rajinikanth's daughter Soundarya.
Vidya Balan's name was also in the news for the lead role.
"We will know in a while," Vidya had told when asked about the project in an event last week.
Produced by Dhanush's home banner Wunderbar Films, the untitled project marks Ranjith's second consecutive collaboration with Rajinikanth after "Kabali".
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