Plaintiffs Organic Seed Alliance, Sierra Club, High Mowing Organic Seeds, and the Center for Food Safety (CFS) say USDA failed to take a " hard look" at the environmental effects of its decision to deregulate in 2005 and are calling for a thorough assessment.
CFS fears the use of Roundup Ready genetically engineered sugar beats in the western US will lead to cross-pollination with conventional beet.
According to the suit filed in California, the sugar beet had not been used since approval because of "market rejection" but will be used for the first time in spring.
Matthew Dillon, director of advocacy at the Organic Seed Alliance, said: "Contamination from genetically engineered pollen is a major risk to both the conventional and organic seed farmers.
The economic impact of contamination affects not only seed farmers, but the beet and chard farmers who rely on the genetic integrity of their varieties."
The Organic Seed Alliance is a non-profit corporation promoting organic seeds.
CFS also claims the use of herbicide resistant crops can help encourage the development of herbicide resistant "superweeds" which develop their own resistant to chemicals.
Monsanto, maker of the sugar beet, was not available for comment prior to publication.
The use of genetically modified organisms (GMOs) in the food chain has sparked fierce debate around the world, although there seems to be more acceptance in the US than in Europe.
Advocates say they can be used to keep food prices down and increase yields.
However, opponents claim there is often not enough science to support their long-term use.
Permission The Roundup Ready sugar beet at the centre of the argument, also known as Event H7-1, was engineered by Monsanto and the German corporation KWS to include a gene that is tolerant to glyphosate, the active ingredient in Monsanto's Roundup herbicide.
Roundup Ready sugar beets qualified as a " regulated article" and could not be introduced into the environment without a permit from USDA's Animal and Plant Health Inspection Service.
The service had received a petition from Monsanto and KWS to deregulate Event H7-1 Roundup Ready sugar beet in 2003.
The following year it made a draft opinion for a proposed deregulation of status, which the Centre for Food Safety raised objections to citing issues including biological contamination.
But in March 2005, USDA announced that deregulation "would not present a risk of plant pest introduction or dissemination " and that H7-1 was no longer to be considered a regulated article.