The director of the US Central Intelligence Agency has acknowledged that his organisation was wrong to let President George W Bush tell the American people that Iraq was trying to acquire nuclear material from Africa.
Tenet says the CIA made a mistake
In a statement, George Tenet said CIA officials had failed to prevent the allegation from being inserted into the president's State of the Union address in January, despite having doubts about its validity.
This, he said, was not the level of certainty required for presidential speeches.
The statement came as senior Democrats called for an independent inquiry into the way the Bush administration made the case for war.
The BBC's Rob Watson in Washington says the White House strategy is clear - to put an end to what has become an increasingly embarrassing row, the CIA has been assigned the blame.
But there are signs that Mr Tenet's admission may not bring an end to the controversy, our correspondent adds.
President Bush has denied that he knowingly gave out false information.
In his January address, Mr Bush said: "The British Government has learned that Saddam Hussein recently sought significant quantities of uranium from Africa."
Mr Tenet, in his statement, said that although the president's words were factually correct - in the sense they attributed the allegation to the British Government - they should never have been included in the speech, given the long-held doubts that US intelligence had about Britain's claims.
The British Government stands by the allegation. Prime Minister Tony Blair's official spokesman has said Britain had separate intelligence from that of the Americans.
The White House acknowledged for the first time earlier this week that the claim about Iraq seeking to buy uranium from Niger might be wrong.
Before Mr Tenet made his statement, some US media reports were suggesting that the CIA had advised the White House to remove the claims from the speech.
Asked about this during a visit to Uganda, Mr Bush replied: "I gave a speech to the nation that was cleared by the intelligence services."
He did not answer when pressed on how the erroneous material came to be included in the address, stressing instead that his government took the right decision to invade Iraq.
Mr Bush's national security adviser Condoleezza Rice insisted the president "did not knowingly say anything that we knew to be false".
Putting the onus of responsibility on the intelligence services, she reiterated that the CIA had vetted the speech and cleared it "in its entirety".
If anyone had any doubts about the uranium claim, "those doubts were not communicated to the president," Ms Rice told reporters.
However, she said the CIA did make some changes to that particular sentence in the speech.
"Some specifics about amount and place were taken out," she said. "With the changes in that sentence, the speech was cleared."
Senior US Democrats are demanding to know what Mr Bush knew about the allegation, and who pressed for it to be included in the State of the Union address, despite the doubts of US intelligence.
One of the contenders for the Democratic presidential nomination, Howard Dean, has demanded resignations over the issue.
Senator Joseph Lieberman, another Democratic presidential hopeful, said the controversy "breaks the basic bond of trust we
must have with our leaders in times of war and terrorism".
Our correspondent says that most worryingly of all, perhaps, for President Bush there now appears to be a shift in public opinion with the latest polls showing that a majority of Americans now believe the White House exaggerated the threat posed by Saddam Hussein.