During the 30-minute meeting at Perdana Putra, Pompeo - who is the most senior US official to visit Mahathir since his election victory - also took the opportunity to congratulate the Malaysian prime minister for his election win in May.
The secretary of state, who arrived at 9am, was accompanied by the US ambassador to Malaysia Kamala Shirin Lakhdhir.
Also present were defence minister Mohamad Sabu and deputy foreign minister Marzuki Yahya.
Pompeo arrived in Malaysia on Thursday to kick off a five-day tour to three Southeast Asian countries.
He is heading to Singapore immediately after meeting Dr Mahathir for the ASEAN's meetings.
The United States established diplomatic ties with Malaysia in 1957 following the then-Malaya's independence from the United Kingdom.
Washington and Kuala Lumpur elevated bilateral relations to a Comprehensive Partnership in April 2014.
