Attorney General Jeff Sessions met Russia's ambassador during Donald Trump's presidential campaign, despite telling his confirmation hearing he had "no communications with the Russians".
The justice department confirmed he met Sergei Kislyak in July and September last year as part of his role on the Senate Armed Services Committee.
Mr Sessions on Wednesday said his comments at his confirmation related to his role on the Trump campaign team.
Democrats accused him of lying on oath.
They said he must resign, and also called on him to step aside from an investigation by the FBI - which he oversees as attorney general - into alleged Russian interference in the US election, including contacts between Russian officials and those involved in campaigning.
The US intelligence community has concluded that alleged Russian hacking of Democratic organisations was carried out to help Mr Trump defeat Democrat Hillary Clinton.
Mr Trump's National Security Adviser, Michael Flynn, was fired last month after he misled the White House about his conversations with the Russian ambassador, allegedly regarding sanctions against Moscow.
What is the basis of the allegation?
As reported in the Washington Post and confirmed by the justice department, Mr Sessions met Russian Ambassador Sergei Kislyak as a member of the Senate Armed Services Committee twice last year.
The Post reports that they held a private conversation in Mr Sessions's office in September and had spoken earlier in the summer at a meeting with several other ambassadors.
Mr Sessions had meetings with more than 25 foreign ambassadors in the course of the year.
But his meetings with Mr Kislyak came while he was a prominent part of Mr Trump's campaign team - a so-called surrogate - and amid growing reports of Russian meddling in the US election.
What did Mr Sessions say?
During his confirmation hearing on 10 January, Mr Sessions was asked by Democrat Senator Al Franken: "If there is any evidence that anyone affiliated with the Trump campaign communicated with the Russian government, in the course of this campaign, what will you do?"
Mr Sessions responded: "I'm not aware of any of those activities. I have been called a surrogate at a time or two in that campaign and I did not have communications with the Russians. And I'm unable to comment on it."
In a statement on Wednesday night, Mr Sessions reiterated: "I never met with any Russian officials to discuss issues of the campaign. I have no idea what this allegation is about. It is false."
Did Sessions mislead the hearing?
Justice department spokeswoman Sarah Isgur Flores said there had been "absolutely nothing misleading about his answer" at the confirmation hearing.
"He was asked during the hearing about communications between Russia and the Trump campaign - not about meetings he took as a senator and a member of the Armed Services Committee," she said.
Mr Sessions was also backed by the White House, which condemned the "latest attack against the Trump administration by partisan Democrats".
Democratic House Minority Leader Nancy Pelosi accused Mr Sessions of "lying under oath" and demanded he resign.
While Congressman Adam Schiff, the top Democrat on the House [of Representatives] intelligence committee, said that if the reports were accurate, Mr Sessions must withdraw from the FBI investigation.
Nikolai Lakhonin, press secretary of the Russian embassy in Washington, said the diplomatic mission did "not comment on numerous contacts" between Russian diplomats and "local partners", Russia's Interfax news agency reports.
What is the new inquiry about?
News of Mr Sessions's meetings broke just after a congressional committeeagreed to an investigation into Russia's alleged interference in the election.
The House intelligence panel inquiry will scrutinise contacts between Donald Trump's presidential campaign and Moscow.
The White House denies any improper behaviour during the election campaign, and Russia has consistently rejected allegations of interference.
Until now, Republican senators had been reluctant to agree to Democratic Party demands for the inquiry.
Meanwhile, the New York Times reports that in the last days of the Obama administration, some White House officials rushed to "spread information about Russian efforts to undermine the presidential election - and about possible contacts between" Mr Trump's team and the Russians.
The paper quotes three former US officials as saying they had two aims - to ensure "such meddling" does not happen in future US and European elections and "to leave a clear trail of intelligence for government investigators".
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