Representative Peter King, a Republican, spoke at a House homeland security committee hearing into the "radicalisation" of US Muslims.
He said "homegrown radicalisation" was "part of al-Qaeda's strategy to continue attacking the US".
Critics say the hearing is feeding anti-Islamic sentiment and criticise Mr King for singling Muslims out.
A senior Democratic congressman warned the committee not to "blot the good name" of American Muslims.
Mr King, a New York Democrat, has said US mosques are a breeding ground for radical attitudes.
'Rage and hysteria'
In his opening statement on Thursday, Mr King said that US anti-terror efforts since the 11 September 2001 attacks had prevented al-Qaeda from launching major strikes on the US from outside the country, but said the Islamist group had turned to actively recruiting Americans for attacks.
"Al-Qaeda is actively targeting the American Muslim community for recruitment. Today's hearing will address this dangerous trend," he said.
He warned that bowing to the "rage and hysteria" the hearing had prompted would amount to "craven surrender to political correctness".
Bennie Thompson, the ranking Democrat on the committee, said the US should also investigate anti-government hate groups as well.
He believes the hearings could be used to inspire terrorist propaganda.
Congressman John Dingell, a Michigan Democrat who represents a large Muslim community, warned Mr King and the committee not to "blot the good name or the loyalty or raise questions about the decency about Arabs or Muslims or other Americans en mass".
"There will be plenty of rascals that we can point at and say these are the real danger to the nation that we love and that we serve," he said.
'Captured by hunters'
Congressman Keith Ellison of Minnesota, the first Muslim elected to Congress, said Mr King's hearing contravened "the best of American values" and threatened US security.
He called for "increased understanding and engagement with the Muslim community".
Also on Thursday, two men who say their sons were turned to violent, radical Islam testified.
The White House has said US domestic security efforts should look at all extremists, not just focus on Muslims.
"We don't want to stigmatise, we don't want to alienate entire communities," US Attorney General Eric Holder said.
But Mr King has said some leaders of American Muslim communities have done too little to co-operate with law enforcement - an assertion Mr Holder has rejected.
On Thursday Melvin Bledsoe, whose son Carlos killed one US soldier and wounded another at a military recruiting centre in Little Rock in 2009, Arkansas testified about what he described as his son's manipulation and radicalisation by Muslim leaders.
"Carlos was captured by people best described as hunters," Mr Bledsoe said. "He was manipulated and lied to."
Also testifying was Minnesota man whose young Somali-American son was recruited to join the al-Shabab militant group, which the US considers a terrorist organisation, and who was killed in Somali.
Other witnesses included Los Angeles County Sheriff Leroy Baca and a Muslim-American doctor and former naval officer.