Australia's main opposition party has accused the US of meddling in upcoming elections by criticising plans to withdraw troops from Iraq if it wins.
Mr Latham says he would have the 800 troops home by Christmas
Labor president Carmen Lawrence said she believed the Bush administration was trying to help conservative Prime Minister John Howard win the election.
Australian voters do not like being told how to conduct themselves by other governments, she added.
President Bush has said an Australian withdrawal would be "disastrous".
His comments earlier this month have been echoed by other White House officials, including Secretary of State Colin Powell.
"It's a bit unseemly for American senior officials to be telling an opposition in this country how to conduct its affairs and what its policies should be," she told Channel Nine Television.
"Australians are a proud people and don't much like being told how to conduct themselves by other governments."
Opinion polls suggest the Labor Party is running neck-and-neck with Mr Howard's governing Liberal Party ahead of elections later this year.
Opposition leader Mark Latham has vowed to pull the 800 troops from Iraq by Christmas if he wins.
Mr Bush said such action, "would say that the Australian Government doesn't see the hope of a free and democratic society leading to a peaceful world."
Mr Latham has insisted he is not anti-American
But US Secretary of State Colin Powell has played down talk that the two nations' 53-year-old alliance would be at risk.
"Australia will always be a close friend of the US," he told Australian television station ABC.
He said the US would respect the decision of the Australian people as to who led their country, and that they would hold talks with whoever became prime minister.
But he defended George W Bush's comments.
"I think the president was speaking candidly, he didn't intend to insert himself into your campaign," Mr Powell said.
"He responded very directly because Australia is such an important country, not only in terms of the military contribution ... but the political statement that comes from Australia is always viewed with a great deal of regard throughout the world."