A man told cops Method Man unleashed a beatdown on him at a gym ... but the Wu-Tang rapper is denying the allegations ... TMZ has learned.

Law enforcement sources tell us a man accused Method Man of punching him multiple times in the face last week at a Staten Island Crunch Gym -- leaving the man in pain and dizzy.

We're told the man was not transported to a hospital for treatment. Cops say they took a report and are investigating -- but so far, no arrests have been made.

A rep for the rapper -- real name Clifford Smith -- tells TMZ Hip Hop ...  "Mr. Smith categorically denies the allegations as reported and has not been the subject of an arrest by any law enforcement agency."