Bob King, the US special envoy for North Korean human rights, was due to travel from Tokyo to Pyongyang today to request a pardon and amnesty for Kenneth Bae.
Bae has been sentenced to 15 years of hard labor by the authoritarian state, accused of subversion.
Department spokeswoman Marie Harf said the US is "surprised and disappointed by North Korea's decision" and remains gravely concerned about Bae's health.
King intends to return to Washington from Tokyo tomorrow. The US is seeking clarification on Pyongyang's decision a further setback to US-North Korean relations, already severely strained by concerns over Pyongyang's nuclear program.