The singer kick started the rumour mill when hitting the 2013 MTV EMA red carpet on Sunday (November 10) - sporting what looked like a diamond sparkler on her ring finger.
However, a source 'close' to K-Pez has since denied the allegations, instead insisting that the 29-year old opted to wear the bling as it went with her mint green Zac Posen frock.
They told Us Weekly: "She's not engaged. It was just a ring that went with the outfit."
Despite Katy not getting hitched this time around, an insider told E! News last week that it is "inevitable" that Katy and Mayer will tie the knot.
They revealed: "Everyone wants them to get engaged. They are so perfect together."
After causing a stir on the red carpet, the Perry wowed crowds at the Ziggo Dome, becoming a life-size Prism for a stunning performance of Unconditionally.
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