The Portugal international, 29, is on loan at Barcelona after spending the second-half of last year on loan at Bayern Munich following a fallout with the City boss.
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Barca are hoping to make the deal permanent this summer, with SunSport revealing that Arsenal are also ready to swoop for the full back.
Reports suggested Guardiola was furious with Cancelo’s reaction to being dropped during City’s Treble winning season.
The two had a bust-up after Nathan Ake and Rico Lewis were picked ahead of him for three games running.
But Cancelo blasted: “Lies were told. I’ve never been a bad team-mate and you can ask either Ake or Rico.
“I don’t have any superiority or inferiority complex towards them.
“Man City were a bit ungrateful to me when they said that, because I was a very important player in the three years I was there.
“I never failed in my commitment to the club and always gave everything – I remember a time when I was robbed and attacked and the next day I was playing at the Emirates against Arsenal.
“These are things you don’t forget. I left my wife and daughter alone at home, terrified. People will only remember this because Mister Guardiola has much more power than me when he says something, and I prefer to keep to myself.
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“I prefer to know that I am telling the truth.”
Speaking to Portuguese publication A Bola, Cancelo insists he made the right choice to leave – despite missing out on the Treble.
He added: “Certain things dictated that I was loaned last year to Bayern Munich. I have no regrets, even if City won the Champions League.
“I feel I made the right choice, that I went to a club that really wanted me. Then I came to Barcelona, lowered my salary, and I’m not bothered by it in the slightest.
“That was the third time I was about to come to Barcelona and I’m finally here.”
Cancelo made 154 appearances for Man City, scoring nine goals and providing 22 assists.
The full-back won three Premier League titles and the Carabao Cup at the Etihad, before he left for Bayern Munich and then Barcelona.
This season he has played 32 games for Barca in all competitions, starting 22 of their 29 league matches.
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