"As announced in September by this year the Prime Minister a small number of NZ SAS personnel have been sent to Kabul to help gather intelligence on the insurgents in the Bamiyan region but are not in a combat role,'' said a Defence Force statement.
John Key flatly denied the claim, saying there were no more than "four or so'' SAS personnel in Afghanistan and they were providing non-combat support for other countries' troops.
He said there was no evidence the group had engaged in combat.
"If the chief of Defence Force decided he wanted a change of heart and put them into a combat-orientated role then he would have to get a mandate from the Government and no mandate's's been sought.''
"I think that they're doing exactly what we sent them to do, which is to help with logistics and planning,'' he said.
Mr Key said the Government had been as transparent as it could be about the SAS's involvement in Afghanistan.
Defence Minister Jonathan Coleman echoed Mr Key's comments.
"No group has been deployed to Afghanistan for a combat mission, so what the Prime Minster says is correct,'' said a spokesman for Dr Coleman.
According to the RNZ report, Mr Stephenson said the troops would be in addition to the ones Mr Key said had been sent to gather intelligence.
He said he had been told they would be playing an "active part in the hunt'' for the insurgents responsible for the deaths of Provincial Reconstruction Team (PRT) members Lance Corporal Jacinda Baker, Private Richard Harris, Corporal Luke Tamatea, and Lance Corporals Rory Malone and Pralli Durrer in two separate incidents.
New Zealand's SAS force of about 70 personnel was withdrawn earlier this year.