Diplomats at the conference said Egypt wanted the language in the meeting's final declaration to say that only "legally registered" groups should be aided by the foundation.
The Americans expressed open irritation with Egypt for its efforts to "scuttle," as one put it, what they had hoped would be a milestone in its efforts to promote democracy in the Middle East.
"Obviously, we are not pleased," a senior State Department official said. Another said, in a tone of exasperation, "I don't understand why they should make this an issue." Both declined to be identified because they did not want to criticize Egypt directly.
Egyptian diplomats have complained that outside financing for groups may end up in the hands of extremists or even terrorists. American officials dismiss those warnings as absurd, noting that some American aid to Egypt, about $430 million this year, already goes to groups in Egypt that do not have government approval.
But American support for independent groups in other countries has alarmed some Arab leaders. They cite American aid that supported groups that led the uprisings in Georgia and Ukraine and point out that both Russia and Uzbekistan have sought to block American aid to groups in their countries.
Since President Bush's inaugural address in January calling for sweeping adopting of democratic rule in autocratic countries, the administration has pressed more and more for aid to the Middle East to go, at least in part, to groups supporting change in their societies, with training, subsidies and such mundane things as printing presses.
The administration first set up its own Middle East Partnership Initiative, which committed $300 million in aid in the last few years to political and business activity in the region.
Now, in part to remove the taint of American fingerprints in a region where anti-American sentiments run high, about $85 million money is to be taken out of this initiative and spun off to the new Foundation for the Future, for support of democratic groups, and the Fund for the Future, for entrepreneurial efforts. Both are part of the Bush administration's so-called Broader Middle East and North Africa initiative, which was set up in the meeting of the major industrial democracies at Sea Island, Ga., in mid-2004.
Secretary of State Condoleezza Rice, in remarks at the session of the conference, hailed the foundation's establishment, which had been negotiated for a year and a half, saying it "will provide grants to help civil society strengthen the rule of law, to protect basic civil liberties and ensure greater opportunity for health and education."
Some delegates to the meeting saw Egypt's objections as a reflection of the Arab world's growing irritation with what some say is the lecturing tone of American calls for democracy. United States involvement in Iraq plays a part in that: the Arab world is not persuaded by the administration's portrayal of Iraq, which Secretary Rice visited on Friday, as a beacon for democracy.
Rather, they say, Iraq represents the perils of imposing democracy from outside. Its current chaos and violence is widely seen as a cautionary tale rather than an inspiration, American officials acknowledge.
Egypt represents more than half the population of the Arab world and is often a leader of its political concerns, particularly in pressing for more attention to be paid in the West to the tensions between Israel and the Palestinians. The disagreement also appeared to reflect a difficult phase in American-Egyptian relations, which have been ruffled by American demands for greater openness in the Egyptian political process.
Egypt rejected an American suggestion for international monitors for its recent presidential election, for example, and complained that it was not receiving credit for conducting its first multiparty elections and for allowing more dissident political activity.
The Egyptian foreign minister, Ahmed Aboul Gheit, left the conference early, declining to join in the final photograph and working lunch, brushing off questions about the final document, telling reporters that there was no such thing, even though a draft had been circulating all day.
But Amr Moussa, a former Egyptian foreign minister who is president of the Arab League, said the final document supporting democracy did not reflect the meeting's consensus. "If a statement is imposed, nobody will give it any consideration," he said.
Egypt's criticism was backed by Saudi Arabia and the Persian Gulf country of Oman, but diplomats said both had agreed in the end to a declaration that had no reference to nongovernment groups.
The Bahrain foreign minister, Sheik Khalid bin Ahmed al-Khalifa, who presided over the session on Saturday, told a news conference that Egypt's objections to the language could not be ironed out because they were presented at the last moment.
"We don't want this to be a haphazard decision," he said. "Due to the short time we had, we didn't have enough time to discuss it."
A draft of the final declaration was prepared more than a month ago, at a meeting in Rabat, Morocco. Mr. Khalifa said a draft might be adopted in a year at the next meeting, in Amman, Jordan.
