Tillerson sat a few feet away from Trump in the Rose Garden as the president put the blame squarely on Qatar.
Egypt separately has asked the United Nations Security Council to investigate reports that Qatar "paid up to $1 billion to a terrorist group active in Iraq" to recently free 26 hostages, including members of its ruling family, saying it would violate U.N. sanctions.
The sheikh's remarks came as efforts intensified to resolve the feud pitting Saudi Arabia and allied Arab nations against Qatar.
Qatar strongly denied the earlier allegations and expressed a willingness to engage in talks to resolve the crisis.
Notwithstanding Qatar's denials, Western diplomats accuse Qatar's government of allowing or even encouraging the funding of some Sunni extremists, such as al-Qaida's branch in Syria.
Qatar also said last month its state news agency had been hacked and false statements attributed to the country's ruler posted, helping ignite the current rift with other Arab states.
The U.S. military has said it wouldn't change its position regarding Qatar's Al-Udeid Air Base, but Mr. Trump said in a tweet Tuesday that other Middle Eastern "leaders pointed to Qatar" funding radical Islamic ideology.
"We call on Qatar to be responsive to the concerns of its neighbors", he said.
The sanctions list further tightens the screws on Qatar, home to a key USA military base and the host of the 2022 Fifa World Cup.
But a Qatari official said on Thursday the emir would not be accepting the invitation.
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A move by four Arab states to blacklist dozens of figures with alleged links to Qatar could squeeze liquidity at Qatari banks which get a significant amount of their funding from the region.
"The blockade is hindering United States military actions in the region and the campaign against ISIS", Tillerson said, using the USA government´s preferred acronym for the group.
Qatar hosts Al Udeid military base, the largest U.S. airbase in the Middle East.
It shows that Qatar "announces fighting terrorism on one hand and finances and supports and hosts different terrorist organizations on the other hand", they said.
One US official said that while Qatar needs to do more to combat terrorist financing, it was inaccurate to single out that Gulf nation.
Washington relies closely on the countries on both sides of the dispute for its military operations in the Gulf: Qatar hosts the U.S. Air Force's biggest base in the region, while Bahrain hosts the U.S. Navy.
He said Iran was ready to help with securing food supplies in the emirate, an investment powerhouse and supplier of natural gas to world markets but tiny and reliant on imports.
The legislation, which also foresees cooperation in military training, was rapidly passed in parliament on Wednesday, a day after Erdogan openly sided with Qatar and criticized other Gulf countries' moves to isolate it.
The Saudi Press Agency on Monday accused Qatari officials of repeatedly violating "their global obligations and the agreements they signed under the umbrella of the Gulf Cooperation Council for Arab States to cease hostilities against [Saudi Arabia] and stand against terrorist activities".
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