O'Donnell voiced her support for the media mogul Friday at New York City's Jingle Ball concert.
(In an interview with Barbara Walters that aired last week, Winfrey broke down in tears, insisting that her relationship with best friend Gayle King is strictly platonic. So goes her now-famous quote: "I have said we are not gay enough times. I am not gay. I am not lesbian. I'm not even kind of a lesbian. And the reason why it irritates me is because somebody must think I'm lying. That's No. 1. No. 2, why would you want to hide it?")
"I think that she's always told the truth so why people wouldn't believe her, you know, I don't know," O'Donnell told ABCNews.com. "Anything that she says, I believe is the truth. ... She's not a faker in any way."
"I thought she was really great on that road trip she did with Gayle when they were going into the camper and Gayle said, 'Let's spice up those lesbian rumors,'" O'Donnell said. "I was cracking up. Listen -- she's pretty magnificent in every capacity and no, I don't think she's gay."
O'Donnell thinks the speculation about Winfrey's sexuality stems from a general lack of knowledge about, or experience with, close female friendships.
"People don't really understand or don't have the privilege of seeing a friendship between two women that is that deep," she said. "I have the same best friend that I've had since I was 3. I know the intensity of that relationship and what it feels like -- to have someone you can depend on no matter what. So, I get it. And I don't think she was defending it as much as just answering all the speculation. She didn't seem defensive to me. If anything, it's just insulting to her integrity that people would consider that she was lying."
Rosie O'Donnell to Premiere New Show on Oprah Winfrey Network
Will O'Donnell revive some of her more infamous feuds -- like the one she started with Donald Trump in 2006, while she was moderating "The View" -- on her latest program? Maybe -- she revealed she's open to interviewing the real estate mogul.
"Resolution is possible," she said. "There could be peace in the Middle East, and he may be my first guest."