The AL urge came at a presidium meeting at the party's Dhanmondi office with AL President Sheikh Hasina in the chair.
"Our fervent appeal to the US is for excluding Bangladesh from the list of terror-risk countries as the majority of Bangladeshis believes in the antiterrorism spirit," the AL presidium said in a resolution.
The meeting hoped the friendly relationship between the US and Bangladesh would continue. It also urged the US administration to make sure that non-resident Bangladeshis (NRBs) are not harassed for what it called the misdeeds of the government 'now isolated from people'.
The AL described the US move as unfortunate and insulting to Bangladesh as well as its people.
It held the BNP-Jamaat government responsible for its failure to save the country from such a disgrace. The decision would mar Bangladesh's export and economy as well as job opportunities for the NRBs, the AL fears.
"Begum Zia's (the prime minister) goal is to make Bangladesh a friendless, weak and disgraced country on the international front."
Because of its inclusion in the terrorism watch list, Bangladesh would become isolated not only from the Third World but also from the developed countries, the AL said.
The AL said the US State Department, European Parliament, Amnesty International and other international human-rights groups and news media accused the BNP-led alliance of violating human rights and persecuting the opposition.
And the alliance's indifference and the wrong policy by the government, the AL said, earned Bangladesh the terror tag.
Following bomb explosions in Mymensingh and Satkhira, the government rejected a US request for probes into the incidents, it alleged.
The party felt the government should have made Bangladesh's position against terrorism loud and clear in the wake of the September 11 attacks and taken diplomatic steps for the national interest and democratic image.
The AL presidium recalled that the AL during its 1996-2001 rule tried its best to improve the US-Bangladesh relationship.
The US-Bangladesh relationship reached new heights during the period thanks to the first-ever Bangladesh visit by any US president.
Also, the US investment in Bangladesh shot to one billion dollars up from 20 million and as many as 23,600 Bangladeshi students pursued higher education in the USA during the AL rule, the party said.