Obama vetoed the bill on Friday, citing concerns that the bill "would be detrimental to US national interests."

"Enacting JASTA into law, however, would neither protect Americans from terrorist attacks nor improve the effectiveness of our response to such attacks," Obama said.

Families of the Sept. 11 victims have been trying to sue the Saudi royal family, Saudi banks and charities in US courts, on ground that the Saudi government provided financial support for terrorism.

Osama bin Laden, the mastermind of the Sept. 11, 2001 terror attacks which killed nearly 3,000 people in New York, Washington D.C. area and Pennsylvania, was a wealthy Saudi national.

But the families' efforts have largely been stymied, in part because of a 1976 law that gives foreign nations some immunity from lawsuits in American courts.

The JASTA has already drawn strong criticism from the Saudi government, a close US partner in fighting terrorism in the Middle East, which has denied any role in the plot of the 2001 terror attacks.

Saudi Arabia has also threatened to sell off hundreds of billions of dollars' worth of American assets held by the kingdom if the US passes and enacts the bill.