The US has announced sanctions on 25 China-based firms and individuals allegedly involved in the production of chemicals used to make fentanyl, reports BBC.
Fentanyl, a potent opioid used as a painkiller or sedative, plays a major role in the ongoing US drug crisis.
Attorney General Merrick Garland said the drug`s supply chain "often starts with chemical companies in China".
China`s embassy in Washington did not immediately respond to a request for comment from Reuters news agency.
In April, a spokesperson for the Chinese foreign ministry said there was "no such thing as illegal trafficking of fentanyl" between China and Mexico.
This came after Mexican President Andrés Manuel López Obrador called on the Chinese government to help stop the alleged flow of fentanyl and its precursors into his country.
The US authorities blame Mexican drug gangs for supplying fentanyl to users across the US.
Fentanyl can be legally prescribed by doctors, but a dramatic increase in opioid addiction in the US in recent decades has led to a rise in illegal production and overdoses.
In 2022, the drug was linked to a record 109,680 deaths.
The US treasury department announced sanctions against what it called a "China-based network responsible for the manufacturing and distribution" of precursors of fentanyl and a number of other illegal drugs.
Officials say companies in the fentanyl supply chain routinely use false addresses and mislabelling to avoid their products being identified by law enforcement.
Those affected by the sanctions include 12 entities and 13 individuals based in China, as well as two entities and one individual based in Canada, the treasury said.
The sanctions will freeze the entities` US assets and bar Americans from dealing with them.
Merrick Garland is due to travel to Mexico with other senior officials for meetings on how to tackle the supply of illegal drugs.
"We know who is responsible for poisoning the American people with fentanyl," Mr Garland told reporters.
"We know that this network includes the cartels` leaders, their drug traffickers, their money launderers, their clandestine lab operators, their security forces, their weapons suppliers, and their chemical suppliers.
"And we know that this global fentanyl supply chain, which ends with the deaths of Americans, often starts with chemical companies in China."
The justice department has also unsealed indictments charging eight Chinese companies and 12 of their employees with crimes related to fentanyl and methamphetamine production, the distribution of opioids and sales resulting from precursor chemicals.
No-one has been arrested and the Chinese government did not work with US authorities on the investigations, Mr Garland said.
