Devin Nunes, a Republican and Chairman of the House Intelligence Committee, told reporters at a hurriedly called press conference that Trump's communications may have been "incidentally" picked up last year by intelligence officials.
The revelation could be a boost to Trump, who until a few weeks ago had alleged - without providing evidence - that his Trump Tower in New York was wiretapped before the elections on November 8 on his predecessor Barack Obama's orders.
"I recently confirmed that on numerous occasions the intelligence community incidentally collected information about US citizens involved in the Trump transition. Details about US persons associated with the incoming administration, details with little or no apparent foreign intelligence value, were widely disseminated in intelligence community reporting," Nunes said yesterday.
"I have confirmed that additional names of Trump transition team members were unmasked."
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Nunes, however, made it clear that none of his observations about surveillance - that he said were based on information received from a source - were related to Russia.
"I have seen intelligence reports that clearly show that the president-elect and his team were, I guess, at least monitored. It looks to me like it was all legally collected, but it was essentially a lot of information on the president-elect and his transition team and what they were doing," he said.
Later, Nunes briefed President Trump at the White House.
"What I've read seems to me to be some level of surveillance activity - perhaps legal, but I don't know that it's right. I don't know that the American people would be comfortable with what I've read," he said outside the White House.
But the public airing of the often-secret information by the Chairman of the House Intelligence Committee has invited immediate protests by Democrats.
Democratic Congressman Adam Schiff, a ranking member of the intelligence committee, said Nunes's actions impede their ability to do an independent investigation.
"The chairman will need to decide whether he is the chairman of an independent investigation into conduct which includes allegations of potential coordination between the Trump campaign and the Russians, or he is going to act as a surrogate of the White House, because he cannot do both," he said.
Schiff said the actions "throw great doubt into the ability of both the chairman and the committee to conduct the investigation the way it ought to be conducted."
House Democratic Whip Steny H Hoyer said he continues to believe that a bipartisan, independent commission - similar to the 9/11 Commission - with subpoena powers is the appropriate way to proceed.
"Chairman Nunes's actions today confirm that belief,"he said.
Nunes's comments came days after the heads of the National Security Agency and the Federal Bureau of Investigation (FBI) repudiated Trump's claims he had been wiretapped.