The announcement on Satuday referred to "the press of business" in Washington and cited Najaf and Darfur as the main reason for the cancellation.
The news from the State Department broke against a backdrop of anti-American protests organised by leftists in the Greek capital.
On Saturday morning, Greek activists hoisted a massive banner on the Acropolis opposing Powell's visit.
The eye-catching banner saying "Powell Killer Go Home" was placed on the hillside towering over Athens after activists entered the Acropolis early on Saturday morning.
Placed just beneath the 2500-year-old Parthenon, one of the world's most famous archaeological sites, the banner bore a hammer and sickle, the emblem of Greek Communists.
Greece's communist party, KKE, was due to stage a protest in Athens later in the day against Powell's presence.
On Friday evening police hurled teargas to disperse about 1000 people in central Athens protesting against US foreign policy, intercepting their journey towards the American embassy.