Cameras caught Simeone speaking to Morata during the 3-0 Champions League semi-final loss to Madrid on Tuesday while holding his hand over his mouth, the 24-year-old striker having been linked with a move despite only returning to the Santiago Bernabeu from Juventus in June.
The Spain international has also been linked with Chelsea and, asked about the gossip at a news conference ahead of his team's Liga match against Eibar on Saturday, Simeone offered an unequivocal response.
"I did not tell Morata to come to Atletico," he said. "I made a joke to Morata when he happened to walk past me."
Across the city at Valdebebas, Simeone's counterpart Zinedine Zidane suggested Morata intends to remain with Los Blancos.
"Alvaro Morata is a Real Madrid player," the French coach said. "He loves this club - it's the club of his life - that is all I can say about that."
Unless there is a dramatic turnaround at Vicente Calderon next weekend, Atleti look set to bow out of the Champions League in the last four.
But after a slow start to a campaign that has been interrupted by injuries, Simeone is proud to have steered his side to third place with three league matches remaining, as they seek to again qualify for UEFA's elite club competition.
"I've said it on several occasions, it's the hardest year since I've been at the club," he said.
"Competing with all the difficulties we've had, it's huge for me. We still have to close it, but when the season is over, the numbers will make us see very good things.
"The last six years are the best in the history of the club."
As for the team's likely response to a heavy loss in an important match away to their arch rivals, the coach said: "We'll see, the team has always had important responses to hard knocks.
"It's what I imagine for tomorrow, I also imagine a Calderon closer than ever to the players, because I repeat once again to our fans that this team is doing an extraordinary season.
"We have been growing for eight years, because two years before my arrival it was already beginning to grow, and evidently these six years, have been extraordinary, possibly the best in the history of the club.
"It is clear that [it is not easy] to approach [the level of] these monsters, but the only way to get to be in that place is to continue maintaining this work that we have been doing for eight years."
Simone confirmed Juanfran is unlikely to play against Eibar but should have recovered from a hamstring injury to be available for the second leg against Madrid on Wednesday.