In making the argument, the Obama administration agreed with the Bush administration's position on the case but insists it came to the decision differently. A civil liberties group criticized the move Friday as a retreat from promises President Barack Obama made as a candidate.
Holder's effort to stop the lawsuit marks the first time the administration has tried to invoke the state secrets privilege under a new policy it launched last month designed to make such a legal argument more difficult.
Under the state secrets privilege, the government can have a lawsuit dismissed if hearing the case would jeopardize national security.
The Bush administration invoked the privilege numerous times in lawsuits over various post-9/11 programs, but the Obama administration recently announced that only a limited number of senior Justice Department officials would be able to make such decisions. It also agreed to provide confidential information to the courts in such cases.
Under the new approach, an agency trying to keep such information secret would have to convince the attorney general and a panel of Justice Department lawyers that its release would compromise national security.
Holder said that in the current case, that review process convinced him "there is no way for this case to move forward without jeopardizing ongoing intelligence activities that we rely upon to protect the safety of the American people."
The lawsuit was filed by a group of individuals who claimed the government illegally monitored their communications. To proceed with the case, Holder said, would expose intelligence sources and methods.
Holder said U.S. District Judge Vaughn Walker, who is handling the case, was given a classified description of why the case must be dismissed so that the court can "conduct its own independent assessment of our claim."
