The New York Times had reported that the United States was grudgingly moving into line with efforts by France and the United Nations to get the group into the Lebanese political mainstream.
"The report suggests that our view has changed on Hizb Allah, and it has not," White House spokesman Scott McClellan told reporters on Thursday. "It's wrong."
Hizb Allah, a resistance movement representing Shia Muslims, flexed its muscle this week by bringing hundreds of thousands of people into the streets of Beirut for a demonstration praising Syria's military presence in Lebanon.
The Lebanese opposition, which opposes Syria's presence, has been trying to persuade Hizb Allah to remain neutral in the country's political crisis.
The United States had long designated Hizb Allah a "terrorist" organisation. The group had been linked to attacks on Americans and US installations, including a truck bombing that killed more than 200 US Marines in Beirut in 1983.
McClellan on Thursday did not repeat Washington's accusation that it was a "terrorist" organisation. "Our view on Hizb Allah has not changed," he said.
Rice: 'The American view of Hizb
Allah has not changed'
"Our focus remains on working with the international community to make sure that Syria gets out of Lebanon, so that the parliamentary elections in May can proceed forward in a free and fair way," said McClellan.
The New York Times said that the United States had basically accepted a French view, echoed by others in Europe, that with Hizb Allah emerging as a powerful force in Lebanon, it was dangerous to antagonise it and wiser to encourage the party to run candidates in Lebanese elections.
"The American view of Hizb Allah has not changed," Secretary of State Condoleezza Rice reiterated to reporters while travelling to Mexico City.
Rice called the Syrian presence an "artificial actor in Lebanese politics".
On whether the United States may have to accept Hizb Allah as an influential force in a democratic Lebanon, Rice said freedom was a key weapon in the "war on terror."
"The goal of spreading democracy or encouraging those who want to engage in democratic processes is completely harmonious with the war on terror because it's the only answer ultimately to those who would use violence and use wanton violence against civilians to try to make some kind of statement or to spread their ideologies of hatred," she said.
"We are not going to deal with Hizb Allah"
US State Department official
"So the long-term victory in the war on terror is only going to be won by the spread of liberty," she added.
A US State Department official stressed that Washington would not have anything to do with Hizb Allah in any way until it "renounced terrorism".
"We are not going to deal with Hizb Allah. We also make the point when we deal with the Europeans and others we are not going to change the point we make - this is the organisation that is linked to terrorism, and this is something you should recognize," the official said.
He said that "for Hizb Allah to be really credible in the international scene, they need to get out of the terrorism game."