The report triggered protests across the Muslim world
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The White House has urged Newsweek to take the lead in repairing the US' image among Muslims after its retracted report about desecration of the Koran.
The magazine on Monday said its report that interrogators at Guantanamo Bay had flushed a copy of the Koran down a toilet was based on flawed sources.
A White House spokesman said Newsweek had done "lasting damage".
At least 15 people were killed in anti-US riots in Afghanistan following the article's publication.
As well as the deaths in Afghanistan, more than 100 people were injured in violent protests across the Muslim world, from Pakistan to Indonesia.
Insulting the Koran or the Prophet Muhammad is regarded as blasphemy and punishable by death in both Pakistan and Afghanistan.
US policies
White House spokesman Scott McClellan told reporters that Newsweek had an obligation to help reverse the effects of its report.
"There has been some lasting damage that has been done to our image... and it's going to take some work to repair that damage," Mr McClellan said.
The magazine should consider writing about US military policies which banned Koranic desecration, he said.
But he acknowledged it was not his job "to get into telling people what they can and cannot report".
'Lying'
Some 520 people remain incarcerated at Guantanamo Bay
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Newsweek's original story claimed that a military investigation was set to reveal evidence of desecration of the Koran at Guantanamo.
It followed repeated allegations by former prisoners at the camp in Cuba that interrogators had prevented them from worshipping or had sought ways to insult their faith.
But on 16 May, the magazine said the investigation in question had not looked at the desecration charges, and that its sources had also backed away from the story.
Defence department spokesman Lawrence Di Rita told a news conference that the charges of desecration had not been considered credible enough to probe.
It was "very likely" that any detainees making such a charge were lying, he said.