U.S. Assistant Secretary of State Jendayi Frazer said on Sunday Mugabe reneged on a power-sharing deal and he was "completely out of touch" and was responsible for turning the once prosperous country into a "failed state".
Mugabe and opposition leader Morgan Tsvangirai agreed on September 15 to form a unity government, a pact supported at the time by the United States. But that agreement has unravelled due to a fight over control of important ministries.
"The inclusive government does not include Mr Bush and his administration. It doesn’t even know him. It has no relationship with him, so let him keep his comments, they are undesired, irrelevant, quite stupid and foolish," Mugabe said at a burial ceremony for a ruling party official.
"We realise these are the last kicks of a dying horse. We obviously are not going to pay attention."
Zimbabwe has sunk deeper into crisis while the stalemate drags on.
Hyper-inflation means prices double every day, a cholera epidemic has killed more than 1,100 people and the opposition has accused the ruling party of abducting its supporters, a charge it denies.
Western countries including the United States blame Mugabe for Zimbabwe’s woes and have intensified calls for him to step down.
There is little Western powers can do to force Mugabe out. Sanctions have failed to weaken him and analysts say his Western foes would not contemplate military intervention because Zimbabwe is not seen as a strategic country with key resources such as oil.
Mugabe has also remained defiant in the face of tough criticism from regional leaders.
Most African leaders, including neighbour South Africa, Africa’s biggest economy, have stopped short of calling on him to quit.