"It is disappointing that Mr Ahmadinejad has once again chosen to espouse hateful, offensive and anti-Semitic rhetoric," Mark Kornblau, spokesman to the US mission to the United Nations, said in a statement.
Delegations from Argentina, Australia, Britain, Costa Rica, Denmark, France Germany, Hungary, Italy, New Zealand and the United States left the room as Ahmadinejad began to rail against Israel, a European source said.
Israel had already called for a boycott of the speech, and was not present when the Iranian leader began his address. Canada had already said it would heed the boycott call.
In his address, Ahmadinejad again took aim at Israel without mentioning the country or Jews by name, referring only to the "Zionist regime."
The firebrand leader, reelected in disputed June elections, accused Israel of "inhumane policies in Palestine."
Delegates walk out on Ahmadinejad (Photo: AFP)
"How can the crimes of the occupiers against defenseless women and children... be supported unconditionally by certain governments," Ahmadinejad asked.
"And at the same time, the oppressed men and women be subject to genocide and heaviest economic blockade being denied their basic needs, food, water and medicine?"
A French diplomat told AFP the Iranian leader's speech was "unacceptable," adding that European delegations had co-ordinated their action in advance if they found parts of the address unpalatable.
Suggesting there was a Jewish conspiracy, Ahmadinejad added: "It is no longer acceptable that a small minority would dominate the politics, economy and culture of major parts of the world by its complicated networks."
And he accused Jews of seeking to "establish a new form of slavery, and harm the reputation of other nations, even European nations and the US, to attain its racist ambitions."
During his speech, Ahmadinejad said his country was ready to shake all hands "that are honestly extended to us." He announced Iran's commitment to participate in building durable peace and security worldwide for all nations while defending the country's legitimate and legal rights.
This appeared to be a reference to Iran's nuclear program, which was not mentioned in his speech.
Ahmadinejad portrayed Iran as a defender of poor developing countries, lashing out at unbridled capitalism which he said has reached the end of the road and will suffer the same fate as Marxism.
The Associated Press contributed to this report