Penn, known for his left-wing politics, referred to the Falklands as the “Malvinas Islands of Argentina” in a meeting with Argentine president Cristina Kirchner.
Also during the meeting – held in Buenos Aires – he said: “The world today is not going to tolerate any ludicrous and archaic commitment to colonialist ideology.
“I know I came in a very sensitive moment in terms of diplomacy between Argentina and the UK over the Malvinas islands.
“And I hope that diplomats can establish true dialogue in order to solve the conflict as the world today cannot tolerate ridiculous demonstrations of colonialism.”
His comments were reported in the Buenos Aires Herald.
Last week, Argentina lodged a formal complaint with the UN, accusing Britain of “militarising” the South Atlantic after it sent the Royal Navy’s most advanced ship, HMS Dauntless, to the region.
Tensions between Britain and Argentina have escalated as the 30th anniversary of the Falklands War approaches.
The British government has said that the islands will remain a British territory as long as a majority of the 3000 islanders want them to be.