Caitlin Hayden, spokesperson National Security Council at the White House, said honouring Imad Mugniyah sends the wrong message.
"The inhumane violence that Mugniyah perpetrated - and that Lebanese Hezbollah continues to perpetrate in the region with Iran's financial and material support - has had profoundly destabilising and deadly effects for Lebanon and the region.
"The decision to commemorate an individual who has participated in such vicious acts, and whose organisation continues to actively support terrorism worldwide, sends the wrong message and will only exacerbate tensions in the region," Hayden said in a statement.