In a statement released on Wednesday, Hamas said the US State Department's decision is a "violation of international law, which has given the Palestinian people a right to defend themselves against [Israeli] occupation, and to choose their leaders.
"This decision demonstrates the full American bias in favour of the Israeli occupation, and provides an official cover for Israeli crimes against the Palestinian people," the statement added.
Hamas, the Palestinian political movement that governs the Israeli-occupied Gaza Strip, said it calls on the US administration to "reverse" this decision and to stop its "hostile policies.
"This will not deter us from carrying out our duties towards our people and defending them, and liberating our lands and holy sites".
The response from Hamas comes shortly after the US designated Haniya a "global terrorist" on Wednesday.
The US State Department issued a press release saying that Haniya "has close links with Hamas' military wing" and "has been a proponent of armed struggle, including against civilians".
Haniya's placement on the "terror list" means that there will be a travel ban on him, and that any US-based financial assets he may have will be frozen.
There will also be a ban on any US citizen or company from doing business with him.
The US State Department accused Hamas of being involved in attacks that resulted in the killing of 17 Americans since the group's founding in 1987.
Al Jazeera's Rosiland Jordan, reporting from Washington, DC, said this designation raises the possibility of the US placing Haniya on trial.
"This possibly makes it easier for the US Justice Department to try to bring him to trial for his alleged role in the deaths of these 17 Americans".
In the State Department press release, the US also designated three other armed groups as being "terrorist groups": Harakat al-Sabireen - a Gaza-based armed group, as well as two Egypt-based groups - Liwaa al-Thawra, and Harakat Sawa'd Misr.
'Icon of resistance'
Haniya, 55, was elected to be the group's political chief in May 2017, replacing Khaled Meshaal. Born in a refugee camp in Gaza, the leader has long been seen as pragmatic and flexible in his attitudes towards Israel, and support for a Palestinian state alongside the Israeli one.
Speaking to Al Jazeera from the Gaza Strip, senior Hamas official Ghazi Hamad said the US' decision is part of a wider campaign against Palestinians since President Donald Trump came into office in January 2017- one year ago.
"It is obvious that this animosity from the US administration towards the Palestinians is unprecedented - with its unconditional support of Israel and its decision surrounding Jerusalem, and cutting its funding to the UN refugee agency [UNRWA]," said Hamad.
"I think Donald Trump is mentally ill. Since he became president ... the US administration has been trying to impose its misguided policies on the Middle East."
Hamad added that Haniya is an "icon of resistance" and that is "something he and we are all proud of".
Trump has made a series of decisions in recent months that have increased tensions in the region.
In a major break with decades of US policy, Trump announced on December 6 that the US formally recognises Jerusalem as the capital of Israel, and will begin the process of moving its embassy from Tel Aviv to Jerusalem.
The move unleashed protests across the occupied Palestinian territories and in major cities around the world.
And, on January 17, the US government decided to cut more than half of its planned funding to the UN aid agency for Palestinian refugees - an institution that has been the lifeline to more than five million registered Palestinian refugees for over 70 years.