Rossi, 41, will leave the Yamaha factory team at the end of the season but is poised for a seat at the satellite Petronas Yamaha outfit in a straight swap with young Frenchman Fabio Quartararo.
The Italian said he expects an announcement on his new deal at the Catalan Grand Prix in two weeks.
"It's not true," Rossi said ahead of his home San Marino Grand Prix this weekend.
"We take time with Yamaha because we are not in a hurry and we have something to fix. But we are very close to signing and I will race with Petronas next year.
"I want to say 99% because it's not signed. But I think that maybe in Barcelona we can give the announcement."
After enduring three difficult races in a row, championship leader Quartararo will be out to build on his three-point advantage at the top of the standings.
In his rookie season last year, the Frenchman battled with world champion Marc Marquez until the final lap at Misano before crossing the line in second place.
"Honestly, it's still difficult to believe that we're still leading the championship. It's crazy," said Quartararo.
"I'm confident because it's a track that I like, I feel comfortable, let's see. For sure I will give my maximum to fight for victory and the podium."
Pramac Ducati's Francesco Bagnaia and LCR Honda Castrol's Cal Crutchlow have been declared fit for this weekend's race.
Bagnaia missed the last three races due to a knee injury while Crutchlow is recovering from arm surgery. (Reporting by Hardik Vyas in Bengaluru, editing by Ed Osmond)