But Trump's threat of an investigation marks only his latest salvo at Google, which he has accused in recent weeks of silencing his conservative supporters online and seeking to rig USA elections in favor of Democrats.
U.S. President Donald Trump is warning his administration may launch a probe into Google over accusations the U.S. technology giant has been infiltrated by the Chinese government.
"As we have said before, we do not work with the Chinese military", a Google spokeswoman said Tuesday. Google has also denied those allegations.
Google said in an email statement: "As we have said before, we do not work with the Chinese military". President Trump has also joined in the chorus of critics, lamenting in an angry tweet in March that "Google is helping China and their military, but not the US". Thiel said in the interview with Carlson.
"We watch with great concern when industry partners work in China knowing that there is that indirect benefit", he said.
Tech giant Google has never provided details on the controversial project codenamed "Dragonfly", being vague about it ever since it was first revealed in August past year.
The Intercept reported Google's Chief Executive Sundar Pichai met with a government official in China and that programmers and engineers have been developing an Android App for the country that blocked out websites.
Facebook board member Peter Thiel on the need for the Federal Bureau of Investigation and Central Intelligence Agency to investigate Google on 'Tucker Carlson Tonight'.
Thiel, whose net worth is estimated at $2.5 billion, is not the only person to have raised suspicion about Google's alleged contribution to Chinese military technology.
Thiel, who supported Trump in 2016 and Facebook board member, made the comments during a speech at the National Conservatism Conference in Washington.
Following a wave of objections from within the company itself, Google officially dropped support for a government-sponsored project past year that would have significantly improved key AI technologies and implemented those in USA military drones.
Google's prototype Chinese search engine had previously been labelled "disturbing" by one former employee. "When you talked to people who are senior at Google, the reason they didn't want to go to China is that they knew everything would be stolen".