US President Barack Obama has ordered a review of US spying operations as European leaders push for new limits on its surveillance programmes.
German Chancellor Angela Merkel, one of the reported targets of the programme, has protested against the surveillance, as have other nations such as Spain and France.
President Obama said he wants to review security operations to ensure privacy is protected.
A series of news reports based on disclosures by former US analyst Edward Snowden described vast National Security Agency powers to monitor phone calls and internet communications throughout the world.
Yesterday, the White House acknowledged the need to rein-in the sweeping nature of the NSA's surveillance practices to ensure that privacy rights are protected.
Amid a growing uproar in Europe and a protest by a key US senator, officials said they would review intelligence collection programmes with an eye to narrowing their scope.
White House spokesman Jay Carney said: "We need to make sure that we're collecting intelligence in a way that advances our security needs and that we don't just do it because we can."
Mr Carney told reporters that with new intelligence-gathering capabilities "we recognise there needs to be additional constraints on how we gather and use intelligence".
This could include greater oversight and transparency, he said.
The comment suggested changes were in the offing on the scale of the electronic spying as part of the White House review of the collection activities of the NSA and other intelligence agencies.
The review is to be completed by year's end.
Collection of data on US allies 'will not continue'
Mr Obama has come under fierce criticism abroad over allegations that the NSA tapped the mobile phone of Ms Merkel and conducted widespread electronic snooping in France, Italy, Spain and elsewhere.
The accusations have caused tension between the US and some of its closest allies and could imperil a US-European trade deal and trans-Atlantic information sharing.
Senator Dianne Feinstein, a California Democrat who chairs the Senate Intelligence Committee, said the White House had told her "that collection on our allies will not continue, which I support".
"It is my understanding that President Obama was not aware Chancellor Merkel's communications were being collected since 2002," Senator Feinstein said in a statement.
"That is a big problem," she said, adding that oversight of the NSA "needs to be strengthened and increased".
Ms Feinstein pledged that her committee will conduct a major review into all intelligence collection programmes.
In an interview with ABC's Fusion network, President Obama acknowledged that national security operations are being reassessed to make sure the NSA's growing technical spying capability is kept under control.
A European delegation took the concerns about the issue to Capitol Hill, where members of the European Parliament met US politicians and spoke of the need to rebuild trust.
"Confidence is vanished," said Elmar Brok, a German member of the European Parliament.
"We have to work hard that confidence is re-established between the leaders, between our people."
The Wall Street Journal reported that the NSA ended the programme that involved Ms Merkel after the operation was uncovered in the White House review that began in the summer.
The programme also involved as many as 35 other world leaders, some of whom were still being monitored, the report said.
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