French President Francois Hollande has expressed “deep disapproval” over claims the US National Security Agency secretly tapped phone calls in France.
In a phone conversation with US President Barack Obama, he said this was “unacceptable between friends and allies”, demanding an explanation.
The White House said the claims “raise legitimate questions”, seeking to ease French concerns.
The NSA has recently spied on 70.3m phone calls in France, it is claimed.
Officials, businesses and terror suspects are believed to have been tracked in just 30 days between 10 December last year and 8 January 2013.
The allegations were carried in France’s Le Monde newspaper and are based on leaks from US ex-intelligence analyst Edward Snowden.
John Kerry talked about “protecting the security of our citizens”
The claims prompted President Obama to call his French counterpart to discuss the issue on Monday.
Mr Hollande said that such practices “infringe on the privacy of French citizens” and demanded “explanations” from Mr Obama, according to a statement issued by French presidency.
A White House statement said the two presidents had discussed the latest disclosure, “some of which have distorted our activities and some of which raise legitimate questions for our friends and allies about how these capabilities are employed”.
It said: “President [Obama] made clear that the United States has begun to review the way that we gather intelligence, so that we properly balance the legitimate security concerns of our citizens and allies with the privacy concerns that all people share.”
Meanwhile, US Secretary of State John Kerry said Washington would continue “bilateral consultations” to address the issue, describing France as “one of our oldest allies”.
“Protecting the security of our citizens in today’s world is a very complicated, very challenging task… because there are lots of people out there seeking to do harm to other people,” Mr Kerry said.
In an earlier statement, National Security Council spokeswoman Caitlin Hayden said that “all nations” conducted spying operations.
“As a matter of policy we have made clear that the United States gathers foreign intelligence of the type gathered by all nations,” she said.
Le Monde says the NSA intercepts were apparently triggered by certain key words.
The agency also apparently captured millions of text messages.
It was unclear whether the content of the calls and messages was stored, or just the metadata – the details of who was speaking to whom.
And the paper did not say whether the operation, codenamed US-985D, was still in progress.
France’s foreign ministry summoned US ambassador Charles Rivkin over the allegations.
The BBC’s Christian Fraser in Paris says the outrage is largely for public consumption, because the French government has been accused of running its own snooping operation similar to the US.
Le Monde reported in July that the French government was storing vast amounts of personal data of its citizens on a supercomputer at the headquarters of the DGSE intelligence service.
The latest revelations follow claims in the German media that US agents hacked into the email account of former Mexican President Felipe Calderon.
Mr Snowden, a former NSA worker, went public with revelations about US spying operations in June.
The information he leaked led to claims of systematic spying by the NSA and CIA on a global scale.
Targets included rivals like China and Russia, as well as allies like the EU and Brazil.
The NSA was also forced to admit it had captured email and phone data from millions of Americans.
Mr Snowden is currently in Russia, where he was granted a year-long visa after making an asylum application.
The US wants him extradited to face trial on criminal charges.