"Even though we support freedom of press and freedom of speech, there are limits," Mahathir said in a live telecast on state TV.
Abolishing the anti-fake news law was one of the Mahathir's campaign promises, but his latest comments point to a re-defining of the controversial law, rather than removing it altogether.
"The fake news law will be given a new definition so that the public and media outlets will know what is fake news and what is not fake," Mahathir said.
Former prime minister Najib Razak's government approved the Anti-Fake News 2018 bill last month, which set out fines of up to 500,000 ringgit ($126,646.40) and a maximum six years in jail for violators.
Mahathir was himself accused of fake news, after authorities said they were investigating him for false claims that his plane was sabotaged ahead of the May 9 election.
The current law defines fake news as "news, information, data and reports which is or are wholly or partly false." It covers digital publications and social media.
Malaysia is among the first few countries to introduce a law against it.