A draft report by the US State Department's inspector general has criticized the Arabic-language Radio Sawa for failing to promote democracy and pro-American attitudes in the Middle East.
Pan-Arab stations bring the news from all over the world
The radio station, which opened in March 2002 with an annual budget of $22m, has been defended by Sawa's operators, the Broadcasting Board of Governors (BBG).
The report's main conclusion is that Sawa has been so pre-occupied with building a large audience with its mix of Western and Middle-Eastern popular music that it has neglected its role in influencing minds in the region.
"Radio Sawa has failed to present America to its audience," the report noted, saying that it compared unfavourably to Al-Jazeera in terms of quality.
The listeners were concerned at the station's poor use of Arabic, said the Washington Post.
"It is not a flattering portrait," a State Department official told the AFP news agency.
Recent contracts awarded by the BBG for customer surveys in the Middle East have led to accusations that the body is more interested in the station's music playlist than it is with news content.
These surveys have shown, however, that Sawa is one of the most popular stations both in the Gulf states and North Africa.
Journalists at Sawa's sister station Voice of America have also been critical of Sawa's role in the Middle East.
VOA staff have complained of slashed budgets and diverted resources as the BBG concentrates its efforts on younger listeners in the region.
Sawa's supporters have been quick to defend the station, citing its popularity in a region where American initiatives are generally met with hostility.
BBG Chairman Kenneth Tomlinson said Sawa is "one of the biggest successes the US has ever had in international broadcasting", citing poorly drafted terms of reference for "a fatally flawed report".
State Department spokesman Richard Boucher was also critical of the draft report. He suggested the report may be revised to reflect the government's "positive" view of the station.
Meanwhile, a US government public diplomacy commission has recommended that the BBG's request for increased funding be approved.
Democratic Senator Joseph Bidden praised Sawa and Al-Hurra for reaching 27m Arab speakers, a 13-fold audience increase over two years.
"They have set a new standard for innovation in US international broadcasting. We are doing a much better job of broadcasting to the people of the Middle East."