Speaking to journalists after meetings with the agriculture industry in central Russia, Medvedev said claims he controlled a vast property empire were "malarkey" that somebody had paid to make into a "quality product".
He said it had been done "to try to pull people out into the streets and reach political ends."
Navalny, an anti-corruption campaigner who plans to stand in presidential elections next year, issued a detailed video report last month alleging that Medvedev was the ultimate owner of an array of luxurious properties managed through obscure foundations.
"This character openly says that 'everyone is horrible, choose me for president'," Medvedev said in televised remarks, referring to Navalny.
"For that he drags people out to the streets, often minors, which is practically a crime, making them hostages of his political programme."
Navalny's report on Medvedev was behind the wave of protests that swept the country on March 26 in one of the biggest challenges to President Vladimir Putin's rule in years.
Over a thousand people were detained in Moscow alone, with dozens sent to jail for up to 25 days, including Navalny, who will remain behind bars until next week.
But the timing of Medvedev's first public reaction to the allegations is likely to raise eyebrows.
It comes as the country's attention is focused on the aftermath of the deadly bombing of the metro in Saint Petersburg that killed 14 people.
Eyewitness? Submit your stories now via social or:
Email: news@pulselive.co.ke
