The U.S. said that civilians "reportedly attempted to leave the area, but the insurgents forced them to remain." The brief statement did not say where the U.S. got that report from. It also did not say precisely how many insurgents the U.S. forces killed.
Villagers in Wech Baghtu said that around 37 people - mostly women and children - died in a Monday afternoon bombing run by jetfighters after U.S. forces and Taliban fighters battled nearby. That home was hosting a wedding party at the time, the reason so many people died, the villagers said.
President Hamid Karzai's office said around 40 people died and 28 were wounded.
Karzai on Wednesday called on U.S. President-elect Barack Obama to ensure that Afghan civilians are not killed in operations by U.S. forces.
The U.S. military said on Wednesday that it was investigating, and a U.S. spokesman added that "if innocent people were killed in this operation, we apologize and express our condolences."
The U.S. military statement Thursday quoted Kandahar's police chief as saying several civilians were injured while attempting to leave the area. The statement also said it was "unclear if they were the victims of the high volume of insurgent direct and indirect fire."
U.S. and NATO commanders often blame Taliban fighters for causing civilian casualties.
In one of the most serious civilian deaths cases in Afghanistan, an Afghan government commission found that a U.S. operation in August in western Afghanistan killed some 90 civilians.
The U.S. at first denied that any civilians had been killed, but after two investigations and the emergence of photographic evidence of dozens of bodies - including children - the U.S. said that 33 civilians had died.
Civilian casualties, which undermine popular support for the Afghan government and the international mission, have long been a point of friction between Karzai and the U.S. or NATO.
According to an AP count of civilian deaths this year, U.S. or NATO forces have killed at least 275 civilians, while 590 have died from militant-caused violence like suicide bombs.
Associated Press writer Jason Straziuso reported from Kabul.