The Qatar Football Association denied having any involvement in such a league.
Les Cahiers du Football (www.cahiersdufootball.net) said it published the fake report by "Agence Transe Presse" on Monday, saying that 2022 World Cup hosts Qatar would launch the money-spinning league involving Europe's leading clubs by 2015.
The website's report contained quotes from Bonnie Pascal-Fasse - for French readers an obvious play on words on French political scientist Pascal Boniface - saying that soccer was not just "a diplomatic tool" but an "end in itself".
"It all came out of my imagination," Jerome Latta, the editor of Les Cahiers du Football told Reuters. "But the fact that it made its way to the mainstream press is quite significant."
The Qatar Football Association also issued a statement saying: "With regard to the story published in today's edition of The Times newspaper concerning a 'Dreams Football League,' the Qatar Football Association and other Qatari football entities can categorically confirm that we have no involvement in any such initiative and has heard nothing to suggest such a concept is genuine."
The newspaper, however, stood by its Wednesday story, saying it had nothing to do with the website version and was based on research by its own reporter, chief soccer correspondent Oliver Kay, going back "quite a while".
"I've been amused by the speculation about the source of this story," Kay told Reuters after a day of intense internet claim and counter-claim. "I can guarantee you 100 percent, 1,000 percent, 175 million percent, that my story had nothing to do with any website, spoof or otherwise.
"I've no idea about their modus operandi. What I know is that my source is very good, the information is very good and that there is more where that story came from."
Tony Evans, Football Editor of The Times, said the speculation was wide of the mark.
"As far as we are concerned the story is true and we stand by it," he told Reuters. "Oliver Kay is an exceptionally good journalist who is unlikely to have fallen for a hoax story on a spoof website.
"He obtained the information after speaking to powerful people in football and after doing his groundwork. He has been working on it for quite a while and there is no reason to doubt he will be fully vindicated."
The supposed 24-team league, featuring 16 permanent sides including Manchester United, Manchester City, Arsenal and Paris St Germain as well as eight "invitees", would be played in Qatar, Saudi Arabia, Bahrain and United Arab Emirates.
The spoof French website report said players, who would earn three to four times what they currently earn, would live on artificial peninsulas where "laws and morals of the continent" would not exist.
It also said that the games would be visible by hologram in the "local stadiums" in Europe, adding that the roars of fans sitting at Old Trafford would be heard in the Gulf stadium where a United game would be played - this being possible as of 2016 thanks to the "Qatar Technologies Institute".
A source close to the Qataris told Reuters he had "seen no evidence of it" when asked if the league was a real proposition from the hugely wealthy Gulf nation.
Whatever the source for the story, Kay said he hoped the plan did not come to fruition.
"As for the idea itself I hope it doesn't get off the ground," he said. "It would be terrible for football and, above all, for fans."
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- Qatar Football Association