The US soldier who went berserk and killed 16 innocent Afghan civilians could face execution, according to the US Secretary of Defence Leon Panetta.
The suspect will stand trial under the legal code of the US military, which allows for the death penalty in some cases, Panetta said.
"That could be a consideration," he said.
Three women and nine children were among those killed when the US Army sergeant broke into village houses and opened fire on the occupants while they slept.
"At some point after that he came back to the forward operating base and turned himself in," said Panetta.
The Afghan parliament has demanded a public trial in Afghanistan. President Hamid Karzai warned Nato that that the Afghan people were running out of patience over the behaviour of foreign troops. he called the incident unforgivable.
President Barack Obama said the massacre did not alter US plans for withdrawal.
"It's important for us to make sure that we get out in a responsible way so that we don't end up having to go back in. But what we don't want to do, is to do it in a way that is just a rush for the exits," Al Jazeera quoted Obama saying.
There are 130,000 Nato troops led by the US in Afghanistan.