The CNN story raised concerns of a potential security threat during President Obama's visit to his ancestral homeland.
"US officials tell CNN, in recent days there is growing social media and internet chatter among the Somali-based militants about the President's visit. 'They all know he is coming', one official with access to the latest intelligence tells CNN."
The report comes after Al Shabaab militants launched a series of deadly incursions into Kenya over recent months.
In the worst attack in April, 148 people were killed at a university in the country's east.
The U-S has raised concerns over poor security along Kenya's north-eastern border with Somalia.
It argues this is allowing Al Shabaab militants to pay bribes to pass across the border.
But Kenya's Interior Minister, Joseph Nkaissery, believes CNN's reporting is discrediting Kenya's status as a secure nation.
"Kenya, like any other country in the world, is at risk of terrorist attacks. Owing to our proximity to Somalia, a country that has been used by international terrorist networks and agents to recruit, train and plan attacks against Kenya and the region, we have suffered terror attacks. However, while these attacks are tragic and unacceptable, they do not turn Kenya into a 'terror hotbed' as alleged by CNN."
During his visit to Kenya, President Obama is expected to look at ways of strengthening security cooperation during talks with his Kenyan counterpart Uhuru Kenyatta..
The two leaders are also expected to discuss closer trade ties, including more direct flights to promote Kenya's tourism industry.
Mr Kenyatta says Kenya wants to work with the United States in countering militant groups such as Al Shabaab.
"We have been working in very close collaboration with American agencies in our fight against terror and I am certain that this is an agenda that we will further strengthen during this particular meeting. Strengthening our partnerships, strengthening our cooperation, because it is our common objective to ensure that not only Kenya, but the whole world is free from those who would wish to impose negative views on the rest of society."
President Obama's visit has attracted a great deal of interest in Kenya, particularly in the village of Kogelo where the president's father, Barack Senior, is buried.
Residents there have named schools and businesses after the U-S President and Barack Obama's half-sister Auma runs a charity foundation there.
The Kenyan government has also brought electricity, water and paved roads to the town since the president took office in 2008.
The Deputy Head Teacher at the Senator Obama Kogelo Primary School, Stephen Okumu, says he hopes the U-S President visits the town and makes some key announcements there too.
"Rumour has it so that the school is going to be face-lifted and then secondly, we as the school are expecting exchange programs between American schools and our school and we expect a situation where our teachers would be allowed to move to America, plus some pupils and then the American schools, pupils and teachers should also come to see how we are learning. We are expecting such things."
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