The economic sanctions were imposed on Rosoboronexport by Washington over the alleged sale of military technology to Iran in breach of non-proliferation agreements.
"We have stated on many occasions that we consider these sanctions to be shortsighted," Medvedev told a meeting of the Commission on Military-Technical Cooperation.
"It is an example of unfair competition and an attempt to cut off suppliers. More importantly, though, this decision will have virtually no effect, and those who imposed them, must keep this in mind," Medvedev said.
The commission met to review the preliminary results of Russia's military-technical cooperation with foreign countries in 2008.
Medvedev said Russia's military export orders are currently in excess of $30 billion and the total volume of arms exports as of October 1 were higher than the same period last year.
"The portfolio of orders has expanded appreciably and is now worth over $30 billion," the president said.
Russia sold $7.4 billion worth of weaponry in 2007 and is expecting to increase its arms exports to $8 billion in 2008.
Russia exports arms to about 80 countries. Among the key buyers are China, India, Algeria, Venezuela, Iran, Malaysia and Serbia.
Medvedev urged Russian defense contractors to fully meet their contractual commitments and ensure the high quality of military equipment deliveries.
"Russian weaponry has been traditionally known for its reliability and [Russia's] defense industry companies must maintain their reputations - any failure to maintain these high standards [of the sold equipment] must be thoroughly investigated," the president said.
