Washington today said it would "respect" the Iraqi prime minister's opposition to the construction of a wall sealing off a Sunni neighbourhood in Baghdad.
However, Ryan Crocker, the US ambassador to Iraq, refused to confirm whether building work would stop.
"Obviously we will respect the wishes of the government and the prime minister," Mr Crocker said. "I'm not sure where we are right now concerning our discussions on how to move forward on this particular issue."
His comments came a day after the prime minister, Nuri al-Maliki, said he had asked Washington to halt work on the "great wall of Adamiya".
Speaking during a visit to Egypt for negotiations, Mr Maliki voiced his opposition to the four-metre barrier, which US troops began constructing under cover of darkness on April 10.
Washington claims the three-mile wall is intended to stem sectarian violence by sealing off the Sunni neighbourhood of Adamiya from the Shia communities surrounding it on three sides.
However, Mr Maliki has asked the US to find alternative means to protect the area, saying the barrier "might have repercussions which remind us of other walls, which we reject".
Hundreds of people today took to the streets in northern Baghdad to demonstrate against the wall.
Mr Crocker said the wall was intended to "bring down the level of violence", adding that it was "in no one's intention or thinking that this is going to be a permanent state of affairs".
Meanwhile, Mr Maliki was today warned that the support of Arab leaders for his Shia-led government would be dependent on improved reconciliation with Iraq's Sunni community.
"Egypt stands by Iraq to achieve peace, security and stability, and stresses the need to achieve national reconciliation between all sects of the Iraqi society," the Egyptian prime minister, Ahmed Nazif, said at negotiations in Cairo.
Diplomats at the gathering - the first leg of a tour that will also take Mr Maliki to Kuwait, the United Arab Emirates and Oman - said the Iraqi PM had been told support from Arab states would be explicitly linked to reconciliation demands.
The talks come 10 days before a pair of conferences on Iraq in the Egyptian Red Sea resort of Sharm el-Sheik, which will be attended by Iraq's neighbours as well as Bahrain, Egypt and the UK, the US, Russia, China and France - the five permanent members of the UN security council.
In other developments, a bomber wearing an explosives belt blew himself up in a restaurant in central Baghdad today, killing at least seven people and injuring 16, police said.
The attack happened less than 100 metres outside the heavily fortified Green Zone, where Mr Crocker was holding a press conference at the time.
The seven deaths were among at least 27 around Iraq today. At least 10 people were killed when a suicide attacker blew up a car in front of an office belonging to the Kurdistan Democratic party just outside the northern city of Mosul.