Carter's concerns are detailed in a letter to a senior member of Congress that was released today.
Congress is poised to override President Barack Obama's veto of the bill that would allow the families to sue Saudi Arabia for the kingdom's alleged backing of the terrorists who carried out the 9/11 attacks.
Obama has warned the legislation would make the U.S. vulnerable to retaliatory litigation in foreign courts that could put American troops in legal jeopardy.
Carter amplifies Obama's concerns. He says cases tried overseas could put the US in the difficult position of having to choose between revealing secrets and suffering adverse rulings for refusing to do so.