US Defence Secretary Ashton Carter has said the rout of Iraqi forces at the city of Ramadi showed they lacked the will to fight against Islamic State.
Mr Carter told CNN's State of the Union the Iraqis "vastly outnumbered" the IS forces but chose to withdraw.
The head of Iraq's defence and security committee said the comments were "unrealistic and baseless".
The Iraqi government has now deployed Shia militias to the area to try to halt the advance of IS.
On Saturday, the militiamen retook Husayba, east of Ramadi, the capital of Anbar province, with heavy fighting continuing in the area on Sunday.
'Very concerning'
The US has invested in a policy of training and arming the Iraqi forces since it withdrew its combat troops at the end of 2011.
But Iraqi forces have suffered a number of defeats at the hands of IS over the past year, leaving behind US-supplied materiel.
Mr Carter said of Ramadi: "What apparently happened is the Iraqi forces just showed no will to fight. They were not outnumbered. In fact, they vastly outnumbered the opposing force."
Describing the situation as "very concerning", he added: "We can give them training, we can give them equipment - we obviously can't give them the will to fight."
Mr Carter said the supply of training and equipment would continue, in the hope it would develop such a will.
The BBC's Rajini Vaidyanathan in Washington says the comments are a stinging assessment of the army the US has been training and will embolden critics who say the only way to defeat IS is to put American boots on the ground - something Washington has so far ruled out.
Hakim al-Zamili, the head of Iraq's parliamentary defence and security committee, criticised Mr Carter for his comments.
Mr Zamili told Associated Press the US had failed to provide "good equipment, weapons and aerial support" at Ramadi and was seeking to "throw the blame on somebody else".
Mr Carter defended the US policy of carrying out air strikes in support of Iraqi ground forces and said the ultimate defeat of IS would depend on the Iraqi people.
He said: "We can participate in the defeat of IS. But we can't make Iraq... a decent place for people to live. We can't sustain the victory, only the Iraqis can do that. And, in particular in this case, the Sunni tribes to the west."
Anbar province, which is predominantly Sunni, covers a vast stretch of the country west from Baghdad to the Syrian border, and contains key roads that link Iraq to both Syria and Jordan.
The fall of Ramadi, just 110km (70 miles) west of Baghdad, was seen as a major embarrassment for the government. Thousands of civilians fled.
The US believes the Iraqis left behind tanks, artillery pieces, armoured personnel carriers and Humvees.
The deployment of the Shia militiamen to the Sunni province has sparked sectarian fears.
In addition to Ramadi, this week IS militants also seized the last Syrian government-controlled border crossing with Iraq and, in Syria itself, the ancient city of Palmyra.
Some observers said IS now controls 50% of Syria's entire territory - as well as a third of Iraq.
Syrian state media said on Sunday that IS had killed at least 400 people, including women and children, in Palmyra since taking it over, but this has not been independently confirmed.
IS control in Iraq and Syria
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