Mack, 35, pleaded not guilty at a brief hearing in federal court in Brooklyn before US Magistrate Judge Cheryl Pollak.
Mack was arrested by the Federal Bureau of Investigation after being accused by two women of directing them to engage in sexual activity with Raniere, 57, who allegedly gave Mack money and other benefits in return.
"Mack directly or implicitly required her slaves... to engage in sexual activity with Raniere", the statement from the attorney's office claims.
According to the Hollywood Reporter, the US Attorney's office for the Eastern District of NY alleges that NXIVM recruited slaves into what was called "a woman's only organization" that would help empower them.
The indictment alleges that the women were deprived of sleep and starved, to the point that they stopped menstruating.
She added: "The accusations that I was in the "inner circle" or recruited women as "sex slaves" are blatantly false".
Federal authorities raided an upstate NY residence near Albany where NXIVM was headquartered in March.
The cofounder of the company and god that is alleged NXIVM, Raniere, stands branding his descent in their own skin and accused of retaining women.
Sarah Edmondson shows the scar she says was left after she participated in a branding ceremony at a private residence near Clifton Park, N.Y., with a small group of other women.
She is due in court later on Friday.
Raniere is the founder of NXIVM, which bills itself as a self-help and empowerment organization, but is described by authorities as a cult-like group whose members recruited women to be sex slaves, and branded their pubic regions with Raniere's initials.
Smallville gave Mack her big break during its run from 2001 to 2011, playing journalist Chloe Sullivan.
She's listed on Raniere's criminal complaint as "Co-Conspirator 1" according to the Albany Times Union. "Mack is one of the women in the first level of the pyramid immediately below Raniere". Raniere will appear in court at a later date.
Actress Allison Mack was charged with sex trafficking on Friday in connection with her alleged involvement in a secret cult in upstate NY.
"Today we announce an additional arrest, and an indictment, in a case that brought to light an inconceivable crime", said FBI Assistant Director-in-Charge Sweeney about Mack's arrest.