The US administration on Tuesday stressed that its support for Israel's security will not be compromised by its partial passage of judicial reforms.
But it underlined to Israeli Defence Minister Yoav Gallant the need for greater political consensus and warned its ally about settler violence.
US Secretary of Defence Lloyd Austin spoke with Mr Gallant and stressed that America's commitment to “Israel's security is steadfast and unwavering”.
The two also discussed threats from Iran and Iran-backed militias.
But during their conversation, Mr Austin stressed the US view that broad consensus through political dialogue, “especially in the coming weeks and months, are critical elements of a resilient democracy".
The Knesset this week passed the first round of divisive judicial reforms that experts say would weaken the power of the Supreme Court and place it in the hands of elected officials.
Prime Minister Benjamin Netanyahu pushed ahead with the reforms despite months of unrest in Israel, and appeals from the US and other countries to hold off and negotiate with the opposition.
Israel's military readiness could be jeopardised, as military reservists say they won't report for duty if the government presses ahead with its plans.
Mr Austin also called for Palestinian leaders to “condemn terrorism and take active steps to prevent violence”, and urged Mr Gallant to address extremist settler violence against Palestinians.
“He also expressed concern regarding the urgent need for Israeli and Palestinian leaders to take meaningful steps to ensure stability in the West Bank,” the Pentagon said.
State Department, spokesman Vedant Patel said there was no question that the US would in any way reduce its security assistance to Israel.
“There is not going to be any cut or stoppage of military aid, and that is because our commitment to Israel and our commitment to Israel's security is ironclad,” Mr Patel said.
On Monday, opposition politicians walked out of the Israeli Parliament as hard-right legislators passed a bill that will stop courts from assessing the reasonableness of government decisions.
Tens of thousands of Israelis took to the streets to protest against the vote and its outcome.
At least 20 protesters were arrested in Jerusalem on Monday, when demonstrators rallied around the Israeli parliament and Supreme Court.
The Netanyahu government went ahead with the vote despite vocal opposition from US President Joe Biden. But the State Department says the relationship will carry on unchanged.
“We also will continue to engage with our Israeli counterparts and Israeli officials to strengthen the bond between the United States and Israel, and to advance our shared democratic values, co-operating on a full range of issues while working through our differences and concerns,” Mr Patel said.