"We have seen a video that purports to be the murder of US citizen James Foley by ISIL," said National Security Council spokesperson Caitlin Hayden.
The intelligence community is working as quickly as possible to determine its authenticity, she said.
Also Read
President Barack Obama was briefed by Deputy National Security Advisor Ben Rhodes on the recently released video by Islamic State of Iraq and the Levant (ISIL).
"The President will continue to receive regular updates," said the Principal Deputy Press Secretary, Eric Schultz.
In a statement, Senator Scott Brown said, "If anyone needed further evidence of the utter inhumanity of Islamic terrorism, this is it."
ISIS is pure evil, and they must be stopped, he said.
The Committee to Protect Journalists condemned the murder of Foley, a US freelance journalist, who was abducted in Syria in November 2012.
In a video posted online, the Al-Qaeda splinter group Islamic State claimed to have executed Foley, saying the act was retribution for US military intervention in Iraq.
The reported video opened with Obama announcing airstrikes against the Islamic State and cuts to a title "A Message to America."
Foley is shown kneeling next to the jihadist.
"I call on my friends, family and loved ones to rise up against my real killers - the US government," Foley is seen saying before his beheading.
"What will happen to me is only the result of their complacency and criminality. I have a message to my beloved parents, 'Don't accept any meager compensation for my death from the same people who effectively hit the last nail in my coffin with their recent aerial campaign in Iraq.'"
Foley then exhorts his brother, John, who serves in the US Air Force, to think about the lives he destroys and about President Obama's decision to bomb Iraq.
"When your colleagues dropped that bomb on those people, they signed my death certificate," Foley said.
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