"There is a Justice Department opinion that says these -- these pieces -- are within the law, so long as they're based upon facts, not advocacy," the president told a news conference.
Among the packages the GAO looked at was one produced by the Health and Human Services Department to promote the Medicare prescription drug law. The story included a paid actor who narrated the piece in a similar style to the way a television reporter would.
"The entire story package was developed with appropriated funds but appears to be an independent news story," the agency said.
It added that some stations were airing such pieces without a disclaimer saying they were produced by the government.
Bush said government agencies, such as the Agriculture Department and the Department of Defense, had been producing such videos for a long time and he said it was appropriate so long as they were "based upon a factual report."
He said it was up to the local news stations to disclose that the segments were produced by the government.
It was not the first time the Bush administration has been criticized for blurring the line between media and government. Earlier this year, the Education Department acknowledged that it paid conservative commentator Armstrong Williams $240,000 to promote the No Child Left Behind Act.