The Pentagon says it is taking steps to demote Democratic Senator and former Navy Captain Mark Kelly, with a reduction in pension, over a video the department described as "seditious".
"Senator Mark Kelly - and five other members of Congress - released a reckless and seditious video that was clearly intended to undermine good order and military discipline," Defence Secretary Pete Hegseth wrote on X.
The Arizona senator was one of six Democratic lawmakers who released a video urging military members to refuse unlawful orders, following US strikes on alleged drug-trafficking boats.
Kelly, a former Navy pilot and astronaut, called Hegseth's action "outrageous" and "un-American".
He has 30 days to submit an official response to the Pentagon's notice, according to Hegseth's tweet on Monday morning.
"As a retired Navy Captain who is still receiving a military pension, Captain Kelly knows he is still accountable to military justice. And the Department of War — and the American people - expect justice," Hegseth wrote in his statement on X.
Hegseth said the department had initiated retirement-grade determination proceedings, where a reduction in Kelly's retired grade would result in a reduction in retired pay.
"If Pete Hegseth, the most unqualified Secretary of Defense in our country's history, thinks he can intimidate me with a censure or threats to demote me or prosecute me, he still doesn't get it," Kelly wrote on X on Monday.
"I will fight this with everything I've got - not for myself, but to send a message back that Pete Hegseth and Donald Trump don't get to decide what Americans in this country get to say about their government."
The controversy stems from a video released last November where Kelly and five other Democratic lawmakers who had also served in the military or intelligence told US service members that they "can refuse illegal orders".
It was released amid rising questions of legality regarding American strikes on alleged narco-trafficking boats off the coast of South America.
Kelly says in the video: "Our laws are clear. You can refuse illegal orders."
"Like us, you all swore an oath to protect and defend this constitution. Right now, the threats coming to our constitution aren't just coming from abroad but from right here at home."
Trump reacted to the video in a series of Truth Social posts, accusing the lawmakers of "SEDITIOUS BEHAVIOR AT THE HIGHEST LEVEL".
Shortly after, the Trump administration announced it was opening a review of Kelly's conduct under military law.
Kelly, a highly decorated retired Navy captain, who served for more than two decades and deployed multiple times, then responded saying: "If this is meant to intimidate me and other members of Congress from doing our jobs and holding this administration accountable, it won't work."
Experts say even though Kelly retired from the military, he is still subject to the Uniform Code of Military Justice (UCMJ) - a federal law enacted by Congress in 1951 that subjects members of the military to a special set of rules.
But legal analysts have questioned the Pentagon's authority to punish a sitting member of Congress for political speech, though the department maintains retired officers remain subject to certain aspects.