Kataib Hezbollah is believed to have been behind the attack in Jordan that killed three US troops.
An Iraqi militant group suspected of launching a drone strike in Jordan that killed three US troops says it has suspended operations against the US.
Kataib Hezbollah, the Iran-aligned group that took credit for the attack on Sunday, said it was “to prevent embarrassment of the Iraqi government”.
President Joe Biden said he has decided on how to respond to the attack, but did not say what the US move would be.
The US has hinted at an armed response that might come in several waves.
“As we announce the suspension of military and security operations against the occupation forces – in order to prevent embarrassment of the Iraqi government – we will continue to defend our people in Gaza in other ways,” Kataib Hezbollah Secretary-General Abu Hussein al-Hamidawi said in a statement on Tuesday.
The three US troops were killed along the Jordan-Syrian border by a drone that was reportedly made in Iran, according to CBS News, the BBC’s US partner.
Dozens more troops were injured in the attack on Tower 22, which was struck while US forces were asleep in their bunks.
The US has blamed Iranian-backed groups and has not yet conclusively determined that Kataib Hezbollah was behind it.
However, a Pentagon spokeswoman said it carried “the footprints” of the militant group.
“Actions speak louder than words,” Pentagon spokesman Pat Ryder told reporters after the group announced that it was halting attacks on the US.
“There will be consequences,” he added.
Meanwhile, the US is taking steps to bolster security at Tower 22, where some 350 US troops are stationed in a mission focused on defeating the Islamic State group.
Additional air defences are being sent to the base, a US official told CBS News on Tuesday, including a system designed to intercept drones.
“Certainly all roads of responsibility lead back to Iran,” House Intelligence Committee Chairman Mike Turner told BBC News, also linking the country to the Houthi attacks against ships in the Red Sea.
“This needs to be responded in a way where they understand that we’re not going to just continue to play defensive,” he said.
He added that the US reaction will force Iran to “understanding that this is a conflict that is going to come to their doorstep”.
Mr Biden is currently weighing a number of retaliatory options, including strikes on Iran-allied militia bases and commanders.
The US could also target senior commanders of Iran’s Islamic Revolution Guard Corps in Iraq or Syria.
It is also possible that the US will attack inside Iran’s borders, a move which is considered the highest possible escalation that Mr Biden could take.
In recent months, several US bases in the Middle East have been attacked by militias trained, funded and equipped by Iran.
It is the first time that a strike has killed US troops in the region since the start of the war in Gaza, triggered by Hamas’s 7 October attack on Israel.
There have been other attacks on US bases in the region, but before Sunday there were no fatalities.
Official have said that US sites in Iraq and Syria had been attacked at least 165 times since 17 October.
Last month, the US carried out airstrikes against Iran-affiliated groups after three US service members were injured, one critically, in a drone attack on a base in northern Iraq.
Earlier in January, one retaliatory US strike in Baghdad killed a militia leader accused of being behind attacks on US personnel.
US Defence Secretary Lloyd Austin said last week that strikes on three facilities belonging to the Kataib Hezbollah militia in Iraq and other groups were “in direct response to a series of escalatory attacks” against US and other international forces in Iraq and Syria.