The monthly trade gap swelled to $48.8 billion as goods imports climbed to the highest level since July 2008, just before the financial crisis caused world trade to plunge, a report from the Commerce Department showed on Friday.
Analysts surveyed before the report had expected the December trade deficit at $48.0 billion, up from a revised estimate of $47.1 billion in November.
U.S. exports grew slightly in December, with records set for petroleum, services and advance technology goods.
For the year, the U.S. trade gap rose 11.6 percent to $558.0 billion, the highest since 2008.
Imports grew 13.8 percent to a record $2.7 trillion, with records set in several categories.
Auto imports rose to the highest since 2007 and petroleum the highest since 2008. The average price for imported oil in 2011 was a record high $99.78 per barrel
The record trade deficit last year with China is certain to reinforce concerns in Congress about Beijing's currency and trade practice ahead of a meeting next week between Obama and the Asian giant's expected next leader, Vice President Xi Jinping.
U.S. exports to China jumped 13.1 percent to $103.9 billion. But that was overwhelmed by a 9.4 percent increase in imports from China, which pushed the tally to a record $399.3 billion.
Last year, the Democratic-controlled Senate passed legislation to pressure China to raise the value of its currency, but that bill hit a dead end in the Republican-controlled House of Representatives.
Many lawmakers believe that China deliberately undervalues its currency to give its companies an unfair price advantage, contributing to the huge bilateral deficit.