Reports in the Italian media had suggested the former Manchester City and Inter forward would be allowed to depart San Siro, with Berlusconi allegedly planning to offload the 23-year-old during the January transfer window.
Balotelli has previously been linked with a move back to England, with Chelsea thought to be among his suitors.
But the Serie A club have strongly denied claims he will be sold and insist there are no plans to allow Balotelli to leave.
A statement on the club's official website read: "AC Milan denies absolutely and vehemently the statements that have been attributed to the president of Milan about a possible placement of Mario Balotelli on the market."
The Italy international joined Milan in last January's transfer window, bringing an end to a three-year stay at the Etihad Stadium.
Balotelli notched 12 goals in 13 league appearances for Massimiliano Allegri's side last season and has six in 12 in the 2013-14 Serie A campaign.
Milan have endured a frustrating season and are 13th with 19 points from 17 games.
‘Even though it was late in the game, the Arsenal fans started singing my name. It felt like the moment I announced myself as a professional footballer’: Ex-Gunners star recalls scoring first senior goal as a teenager at Highbury
'I started to drive myself crazy': Former Manchester United midfielder explains why it all went wrong for him under Erik ten Hag
