The paper said Lavrov repeatedly used foul language as British Foreign Secretary David Miliband warned him that Europe would reassess its ties to Russia following the country's invasion of Georgia last month.
According to the Telegraph, the conversation was so laden with obscenities it was difficult to draft a readable summary. The paper cited an unidentified "insider" as the source of its information but did not say when the exchange took place.
In Moscow, the Foreign Ministry denied the report and on Saturday accused the British government of deliberately leaking its version of the exchange to the media.
"Such leaks are probably aimed at attaining political ends and pouring oil on the flames of hysteria surrounding Russia's actions in the Caucasus," ministry spokesman Andrei Nesterenko said, Interfax reported. "As we understand, the leak was authorized by David Miliband."
Britain's Foreign Office denied that allegation but did not comment on the tenor of the conversation.
"We don't go into the details of confidential discussions between foreign ministers," a Foreign Office spokeswoman said Friday. She refused to comment further and demanded to speak anonymously in line with department policy.
Nesterenko promised that Russia's transcript of Lavrov's conversation with Miliband would soon be posted to the Foreign Ministry's web site.
British-Russian relations are at a post-Cold War low after Russia refused to extradite a suspect in the poisoning death of Alexander Litvinenko in London in 2006 and closed offices of the British Council earlier this year.
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