Huawei, barred from projects in Australia and the United States over national security concerns, was reportedly selected as a subcontractor for LGU+, a subsidiary of South Korea's LG Corp, to build a Long Term Evolution (LTE) network.
But US defence and intelligence officials and key politicians on Capitol Hill are expressing concerns over the deal, amid fears it could allow Chinese spies access to sensitive communications and even pose an eavesdropping threat to US forces in South Korea and elsewhere.
A senior US official said on Tuesday that Washington was "concerned" about the potential project, because Huawei was excluded from a project to provide wireless broadband services in the United States over similar national security concerns.
A defence official meanwhile said that there were also concerns at the Pentagon and that US force commanders in South Korea had been asked to provide an "assessment" of the potential impact of the deal.
Officials would not say if they had formally raised those concerns directly with the South Korean government.
But signs of US concern may anger China — and leave Washington on sensitive political ground given leaks by fugitive intelligence contractor Edward Snowden about a massive American worldwide eavesdropping operation by the National Security Agency.
The United States, Britain, and Australia have all raised concerns that Huawei's alleged ties to the Chinese state could see telecoms equipment supplied by the company used for spying and cyber-attacks.
Huawei denies it has any direct links to the Chinese state, but Australia has barred it from involvement in the country's new broadband network, while Congress last year called for its exclusion from US government contracts.