Authorities say his teachings and writings have been discovered on the computers of a number of radicals who have tried to carry out terror plots here in America. Holder said Awlaki is able to preach violence on al Qaeda websites, and reach new converts.
"The ability to go into your basement, turn on your computer, find a site that has this kind of hatred spewed ... they have an ability to take somebody who is perhaps just interested, perhaps just on the edge, and take them over to the other side," he said.
To combat the threat of Americans turning to al Qaeda and violence, the United States is monitoring scores of radicals and has set up stings to blunt the threat.
The increasing number of FBI stings, such as the alleged plot to detonate a bomb at a Christmas tree lighting in Portland, are not without controversy, but Holder vigorously defended them.
"Options are always given all along the way for them to say, 'You know what, I have changed my mind. I don't want to do it.' Everyone that we have charged has said, 'No I want to go forward,'" he said. "All those actions were designed to kill Americans.
"I have to have all those tools available to me to try to keep the American people safe, and to do the job that I'm supposed to do as a 21st century attorney general," Holder said.
Holder said the United States has made great strides in improving its ability to detect and block attacks, which is shown by the number of would-be terrorists who have been stopped before they could kill Americans. The intelligence community is working around the clock, he said, with little time off.
"We are doing everything that we possibly can to keep the American people safe," Holder said. "We are vigilant, we are doing everything we can to keep our homeland secure,"
Turning to how terror suspects are tried, Holder said he still believes the "decision as to how people get prosecuted, where they get prosecuted, is an executive branch function. Even if those suspects are being held now at Guantanamo Bay. Holder said Congress should not be interfering with that.
"It's -- from my perspective -- a constitutional issue," he said.
As for Julian Assange and Wikileaks, Holder said "it's an ongoing investigation."
"What Wikileaks did, at the end of the day, was harmful to American security, put American agents and properties ... at risk ... and I think for arrogant and misguided reasons," he said.