Schaefer has been convicted of killing Mack's wealthy mother, Sheila Von Weise Mack, 62, by bashing her with a glass fruit bowl in a Bali hotel room, in 2014.
Mack too was convicted but she told the court she was in the bathroom when the fatal blows were struck. She then helped Schaefer stuff Von Weise Mack's body in a suitcase, which they dumped in a Bali taxi before the couple went on the run, even using the dead woman's credit card.
The argument preceding the murder was said to relate to then teenager Mack's pregnancy to Schaefer.
The couple's daughter Stella was born shortly before both were found guilty in Denpasar District Court. Schaefer was sentenced to 18 years and Mack to 10 years.
But the couple now appear to be estranged inside Kerobokan prison and by next month Stella will be 2 and must leave the prison, under Indonesian jail rules. Her guardianship has also been a troublesome issue between her jailed parents.
In a statement released yesterday by lawyers in Bali, Mack denies the video's contents.
In a two-page document, titled "A Clarification", Mack and her lawyer Yulius Benyamin Seran, say the video is fake by design" and "recorded under pressure". "Tommy Schaefer has written the scenario of confession... [for] her to be read."
The statement says Mack did not upload the video and that other parties deliberately created an account with the name Heather Mack to create the illusion that it was Mack's doing.
And it points out that the court verdict against Mack and Schaefer is final and binding and that the video is not "new evidence" to reopen the case.
"Heather Mack is a victim of such fake video and allegedly there is the motivation behind the video published on the YouTube page to affect the ongoing trial in Chicago as well as efforts [to] interfere [with] the process of transition [of] Stella's guardianship," the statement says.
It is signed by Mack and her lawyer.
It comes after furious prison officials vowed to get to the bottom of how Mack had used contraband to upload a video and threatened to strip her of her annual sentence remissions as punishment. Phones and the internet are banned in the jail. But under questioning by officials Mack denied uploading the video.
When prison officials sought to bring her and Schaefer together in one room for what is known as a confrontation of their conflicting versions, the pair refused to meet each other face-to-face.
In the video, Mack writes Schaefer out of the murder. Titled "Confession Mack", the video says her plot to kill her mother during a Bali holiday was in revenge for her mother killing her father during a holiday she was 10.
James L. Mack reportedly died from a pulmonary embolism while on holiday in Athens.
But Mack claims in the video that this was not true and that she decided to avenge her father by killing her mother.
Schaefer confessed to police and in court that he killed Von Weise Mack, hitting her with a heavy glass fruit bowl in her hotel room.
The death came after an argument over Mack's teenage pregnancy and what Schaefer said was a racial slur against him.
In 2015 the couple lost their appeals in the Bali High Court against their sentences. Prosecutors had recommended that Mack deserved 15 years behind bars.
Schaefer has yet to make any comment about the latest furore that has engulfed the controversial couple.
Mack's time in Kerobokan prison has been punctuated by changing stories, regular missives sent from her mobile phone and denials of claims in the US courts regarding her battle to access her late mother's $1 million-plus estate. In the now-denied video she said that the couple lied about her involvement to ensure she would access her mother's substantial estate.
Mack's family in the US has reportedly already denied the latest video contains any truth.
