US regulators have sued Amazon, alleging that the internet giant is illegally maintaining monopoly power.

The Federal Trade Commission (FTC) said Amazon uses “a set of interlocking anticompetitive and unfair strategies” to push up prices and stifle competition.

Amazon said the lawsuit was “wrong on the facts and law, and we look forward to making that case in court”.

It is the latest technology giant to be sued by US regulators.

The dominance of a handful of powerful tech firms has led some US politicians to call for action that would promote more competition in online search, retail and social media.

The FTC, along with 17 state attorneys, claims that Amazon is a “monopolist” that stops rivals and sellers from lowering prices.

The regulator also alleged the internet giant’s actions “degrade quality for shoppers, overcharge sellers, stifle innovation, and prevent rivals from fairly competing against Amazon”.

However, Amazon said that if the “misguided” FTC lawsuit is successful, it would mean fewer products to choose from, higher prices, and slower deliveries for consumers.

The lawsuit is the latest US government legal action aimed at breaking the dominance of massive US tech firms.

Earlier this month, a court battle began between Google and the US government, which has accused it of having an advertising technology monopoly.

However two previous cases brought by the FTC failed.

The agency objected to Microsoft’s $69bn (£57bn) buyout of videogames giant Activision. But was unsuccessful in blocking it.

A case against Facebook’s parent company Meta buying a VR company called Within, also failed.