The US has imposed sanctions on Palestine Action, designating it as a terrorist group.
The US Department of the Treasury said it had "taken action" against the UK-based group, which it accused of supporting "numerous acts of terrorism since July 2020".
Supporting Palestine Action became illegal in the UK in 2025 after the government banned it under anti-terror legislation.
The group's co-founder Huda Ammori responded in a social media post, saying: "As a Palestinian and Iraqi, the fact the country which destroyed both my homelands is calling me a terrorist, is beyond hypocritical."
In a statement to the BBC, Ammori said the group's actions had "always been about saving lives", adding the ban should be a "wake-up call to anyone who cares about free speech and democracy".
Announcing the move in a statement on Wednesday, US Treasury Secretary Scott Bessent said: "Far-left extremists, their fronts, and their enablers should be on notice: We will bring the full weight of our economic tools to bear.
"Political terrorism has no place in our society, and we will continue to cut the financial lifelines of these groups until they are eliminated."
The sanctions imposed include freezing any assets belonging to the group that are either based in the US or in the control of US citizens.
The US ban on the group is part of a wave of sanctions announced by the Trump administration against what it says are far-left terror organisations around the world.
The Department of Treasury accused Palestine Action of having supported "numerous acts of terrorism since July 2020, including acts that have physically injured UK law enforcement personnel, as well as acts intended to intimidate lawful commercial enterprises and coerce the UK government".
Palestine Action, which used so-called direct action tactics against Israeli-linked arms companies in the UK, has been facing an ongoing legal battle to get its UK ban overturned.
In June, Court of Appeal judges ruled the UK government made a "justified and proportionate" interference on freedom of expression rights.
But Palestine Action has since been given permission to challenge the decision at the Supreme Court.
More than 2,000 people are facing potential trial after being arrested for protesting against the ban by allegedly declaring their support for a proscribed terrorism group during mass demonstrations.
Separately, four of its members were jailed in June for a break-in at a defence firm that caused more than £1m worth of damage, with one person sentenced for causing grievous bodily harm on a police officer who was hit with a sledgehammer.
SOURCE/AUTHOR : BBC NEWS/Paul Gribben
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