Demetriou said the financial package for the embattled Demons will be finalised "in the coming days".
But he dismissed suggestions the League was giving the club money to lure former Sydney Swans mentor Paul Roos or any other coach.
"All I can say is that the reports the AFL is somehow funding the recruitment of some coach at a very large [sum], whoever it may be, it's just not true," Demetriou told Fox Footy's AFL 360 on Tuesday night.
"The extent of the financial package that we are [offering] is about the slow rebuild of the Melbourne Football Club.
"The extent of the financial package does not contain a large amount of money to recruit some coach at a very large amount of money … it is highly conditional and the assumptions that it is there with this large support of the AFL to go and recruit a coach is incorrect."
The AFL Commission met on Monday and discussed the financial bailout, which will be finalised when the League meets with the Demons in the coming days.
Demetriou confirmed it would be a "substantial package" that was "in line with the expectations that the Melbourne Football Club needs to commence its rebuild".
He said the AFL would not have a say in the coaching appointment and that decision would rest with the club and CEO Peter Jackson.
"We are obviously being consulted on those issues but, and I've said this before, it's not the AFL's role to appoint coaches," he said.
"There's not a person in my organisation that has the expertise in the coaching area. I'm being quite frank there.
"We are there to help the Melbourne Football Club; Peter Jackson is in there doing a fine job, we're working with the club about the composition of the board."
Jennifer Phelan is a reporter for AFL Media. Follow her on Twitter @AFL_JenPhelan.
