His denial comes after an excerpt was leaked from the Baywatch star's upcoming memoir, Love, Pamela.
Anderson's tell-all transcript — set to release Tuesday, January 31 — details the alleged provocative encounter, which supposedly took place when she was only 23 years old and Allen was 37.
“On the first day of filming, I walked out of my dressing room, and Tim was in the hallway in his robe," she wrote in her jaw-dropping book. "He opened his robe and flashed me quickly — completely naked underneath."
"He said it was only fair, because he had seen me naked," Allen allegedly quipped, according to Anderson's memoir.
The nude reference was seemingly in regard to the celebrity's days as a Playboy model and famously known sex symbol.
"Now we’re even. I laughed uncomfortably," the Barb Wire star concluded of the horrific encounter.
Anderson's juicy memoir will reportedly dish out even more heated accusations, such as the multiple instances she was allegedly sexually assaulted when she was only a child.
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- Pamela Anderson 'Couldn't Help' But Look After Accidentally Catching Jack Nicholson In A Threesome At The Playboy Mansion
- Pamela Anderson Says Tim Allen Had 'No Bad Intentions' When He Allegedly Flashed Her: 'It's His Job To Cross The Line'
In addition, the chronicle is set to describe the mom-of-two's love life, transition from a Playboy Bunny to well-acclaimed actress and even dive into Pam and Tommy.
The Hulu hit series — which was nominated for multiple Emmy, Golden Globe and Critics' Choice awards — tells the story of the time Anderson and her ex-husband Tommy Lee's honeymoon sex tape was stolen from their Malibu mansion in 1995 and released to the public.
The separated spouses only knew each other for 95 hours before they tied the knot on a beach in Cancun. Anderson and Lee share sons Brandon, 26, and Dylan, 25, and ended their three-year marriage in 1998.
Variety obtained a statement from Allen and the excerpt from Anderson's memoir.