The House of Representatives approved the legislation in December and the Senate passed it in February, despite White House warnings that it would be vetoed.
The simulated drowning technique has been condemned by many members of Congress, human rights groups and other countries as a form of illegal torture.
Michael Hayden, director of the CIA, told Congress last month that government interrogators used waterboarding on three suspects captured after the September 11, 2001 attacks on the World Trade Centre.
The US army field manual prohibits waterboarding and seven other interrogation methods and the bill would have aligned CIA practices with that of the military.
In a message to CIA employees on Saturday after Bush’s veto, Hayden said the CIA would continue to work strictly within the law but said its needs were different from that of the army.
The memo said the CIA needed to follow its own procedures. In his remarks, Bush did not specifically mention waterboarding.
“The bill Congress sent me would not simply ban one particular interrogation method, as some have implied,” Bush said.
“Instead, it would eliminate all the alternative procedures we’ve developed to question the world’s most dangerous and violent terrorists.”
It is unlikely that Democrats, the majority party in Congress, could muster enough votes to overturn Bush’s veto.
Source: News Agencies