Critics say existing tribunals' powers must be extended
The US has vehemently opposed the setting up of the ICC, fearing its soldiers and diplomats could be brought before the court which will hear cases of war crimes and crimes against humanity.
The Washington Working Group on the ICC - an umbrella group of organisations supporting the court - said withdrawing from the treaty was a "rash action signalling to the world that America is turning its back on decades of US leadership in prosecuting war criminals since the Nuremberg trials."
US 'undermined'
Judge Richard Goldstone, the first chief prosecutor at The Hague war crimes tribunal on the former Yugoslavia, echoed these sentiments saying:
"I think it is a very backwards step. It is unprecedented which I think to an extent smacks of pettiness in the sense that it is not going to affect in any way the establishment of the international criminal court".
"The US have really isolated themselves and are putting themselves into bed with the likes of China, the Yemen and other undemocratic countries," he added.
US senior diplomat Pierre-Richard Prosper said the letter "neutralised" Mr Clinton's signature on the treaty.
By unsigning the treaty, the US would no longer have to extradite people wanted by the court, he said.
"What we've learnt from the war on terror is that rather than creating an international mechanism to deal with these issues it is better to organise an international mandate that authorises states to use their unilateral tools to tackle the problems we have," Mr Prosper said.
US Secretary of State Colin Powell, announcing the decision on Sunday, said the court would undermine US judicial authority.
He said it would be accountable to no higher authority - including the UN Security Council - and would be able "to second-guess the United States after we have tried somebody".
'Wrong side of history'
For President George W Bush's critics, this decision serves as further proof of a unilateralist approach to foreign policy and puts him at odds with allies, including Canada and the European Union, which support the ICC.
"The administration is putting itself on the wrong side of history," said Kenneth Roth, director of Human Rights Watch.
"Unsigning the treaty will not stop the court. It will only throw the United States into opposition against the most important new institution for enforcing human rights in 50 years," he said.
The court itself still has enough international support to begin work in The Hague next year - but without US backing, correspondents say it will be a far less powerful and effective player on the world stage.