President Donald Trump used an event honouring Native American veterans to hit out at Democratic senator Elizabeth Warren, whom he has long derided as Pocahontas.
Mr Trump welcomed three Navajo code talkers from the Second World War to the Oval Office.
He called them "incredible" and "very special people".
During remarks on Monday praising their service, Mr Trump said: "We have a representative in Congress who they say was here a long time ago.
"They call her Pocahontas.
"But you know what, I like you."
The Republican president has repeatedly mocked the Massachusetts senator for claims she has made about being part Native American.
Native American leaders have called Mr Trump's past attacks on Ms Warren offensive and distasteful.
Some Democrats have called the remark racist.
Ms Warren quickly denounced Mr Trump's comments.
"This was supposed to be an event to honour heroes, people who put it all on the line for our country, who, because of their incredible work, saved the lives of countless Americans and our allies," Ms Warren said in an interview on MSNBC.
"It is deeply unfortunate that the president of the United States cannot even make it through a ceremony honouring these heroes without having to throw out a racial slur."
The president has long feuded with Ms Warren, an outspoken Wall Street critic who levelled blistering attacks on Mr Trump during the campaign.
He has seized in particular on questions about her heritage, which surfaced during her 2012 Senate race challenging incumbent Republican Senator Scott Brown.
During that campaign, law school directories from the Association of American Law Schools from 1986 to 1995 surfaced that put Ms Warren on the association's list of "minority law teachers" when she was teaching at the University of Texas and the University of Pennsylvania.
Ms Warren said she listed herself with Native American heritage because she hoped to meet people with similar roots.
In a 2012 interview with The Associated Press, Ms Warren said she and her brothers were told of the family's heritage by their parents, the late Don and Pauline Herring.
Mr Brown pressed Ms Warren to release more information about how she described her heritage to potential employers.
Ms Warren said she never sought proof of ancestry because she did not think it was necessary.