An army official, speaking on condition of anonymity because of the sensitivity of the situation, told The Associated Press "this is definitely not a coup. This is only to provide safety to the people and the people can still carry on their lives as normal."
A ticker on Chanel 5, an army station, also denied the military was taking over and asked the public not to panic.
Thailand's army has staged at 11 successful coups since the end of absolute monarchy in 1932. The last was in 2006.
Thailand, an economic hub for Southeast Asia, has been gripped by off-and-on political turmoil since 2006, when former Prime Minister Thaksin Shinawatra was toppled by a military coup after being accused of corruption, abuse of power and disrespect for King Bhumibol Adulyadej.
The latest round of unrest started last November, when anti-government protesters took to the streets to try to oust then-Prime Minister Yingluck Shinawatra, Thaksin's sister. She had dissolved the lower house of parliament in December in a bid to ease the crisis.
Earlier this month, the Constitutional Court ousted Yingluck and nine Cabinet ministers earlier this month for abuse of power, but the move has done little to resolve the political conflict that largely pits the rural poor majority who support Yingluck and her opponents that largely come from the urban middle and upper class.
The military statement was signed by army chief Gen. Prayuth Chan-Ocha, who later read it on air. He cited a 1914 law that gives the authority to intervene during times of crisis, and said it had taken the action because on-going mass rallies between political rivals "could impact the country's security and safety of the lives and public property."
On Monday, Thailand's acting prime minister insisted his government will not resign, resisting pressure from a group of senators who are seeking ways to settle the country's political crisis, and from anti-government protesters who are demanding an appointed prime minister.
A group of about 70 senators, most of whom are seen as siding with the anti-government protesters, proposed a framework on Friday that calls for a government with full power to conduct political reforms.
Acting Prime Minister Niwattumrong Boonsongpaisan and Justice Minister Chaikasem Nitisiri met with two representatives of the Senate in an undisclosed location Monday to avoid disruption from the protesters.
After the meeting, Niwattumrong said the Cabinet cannot resign because it would be unconstitutional to do so. He insisted he "can carry out duties and has full authority" as prime minister.
The Cabinet has operated in a caretaker capacity with limited power since Yingluck dissolved the lower house in December in a failed bid to ease the political crisis. A new government cannot normally be named until there are elections, which anti-government demonstrators have vowed to block unless political reforms occur first.
The Senate, the only functioning legislative body in the country, was seen as the last resort of the anti-government protesters, who are calling for an interim, unelected prime minister to be chosen.
The protesters say they are making their final push to oust the government and install an unelected prime minister and government. They have promised to call off their rallies if they are not successful by May 26, following six months of street demonstrations in which 28 people have died and hundreds of others have been injured.
The protesters on Monday began searching for members of the Cabinet at their residences to pressure them to resign, but did not find any.