"We know well these allegations are the products of dirty plots," said Davutoglu during his national address, titled "On the Road to a New Turkey," which aired on television on Tuesday.
Certain opposition members and media outlets had suggested that Turkey had had relation with the Islamic State of Iraq and the Levant.
On July 18, Turkey's main opposition, the Republican People's Party (CHP), had submitted a motion calling for a parliamentary inquiry to investigate the relationship between Turkey and the Islamic State of Iraq and the Levant, or ISIL.
CHP's MP Sezgin Tanrikulu had pointed to the abduction of 49 Turkish nationals by ISIL militants in the northern Iraqi city of Mosul. He had claimed that the fact the government had not taken any action against ISIL indicated that the two sides may have had an "indirect relationship" with each other.
These claims were also relayed by certain media outlets.
Davutoglu called these types of allegations as unjustified and baseless, reiterating the fact that the government had designated ISIL, which controls large parts of Iraq and Syria, as a terrorist organization.
"Turkey is ready to take every kinds of step to eliminate atrocities and terror structuring aimed at the lives of innocent people," he added.
Davutoglu also criticized the international community for failing to take Turkey's advance warning on Syria, Iraq and Palestine into consideration.
The indifference of the international community caused people of this region to pay a grave cost, he added.
"Sparks turned into fires threatening the whole region as a result of these insensitive and controversial [international] policies," said Davutoglu, underscoring the fact that organizations like ISIL had expanded their control over conflict-ridden regions by taking advantage of the chaos caused by governmental vacuums.
Turkey had already warned the international community to support democratic attempts and to protect those elected thanks to democratic methods in the region, he recalled during his address.
Stressing the fact that his government would not approve any project that would damage Turkey, jeopardize its people or their interests, Davutoglu asserted that three main conditions had to be considered in order for the country to take part in an international coalition against terrorism: preserving Turkey's national interest and security, assisting all relatives from neighboring countries regardless of their language, religion and nationality, and building a lasting regional stability.
Touching on the crisis at the Turkish-Syrian border caused by ISIL, Davutoglu reiterated that more than 160,000 Syrian refugees had fled ISIL from the Kurdish-populated city of Kobani, also known as Ayn al-Arab.
"Those people, mostly our Kurdish brothers, are fleeing war, fire and atrocity and viewing Turkey as a hope," said the prime minister, adding that Turkey had adequate experience and opportunities to cope with problems that could occur with these refugees.
"We will see soon that the benevolent attitude of our people will bring prosperity and abundances to our country," he added.