The prime minister's communications director, Jason MacDonald, responded by saying, "We will not take seriously criticism from an organization with documented ties to a terrorist organization such as Hamas."
Hamas is listed as a terrorist organization in Canada.
Reached by email Thursday, MacDonald, who is also named in the suit, declined to comment.
The council wanted to give Harper time to either retract the comments or offer evidence proving them. After receiving neither, the group filed the suit Monday.
The council said it has consistently condemned terrorism.
The council was affiliated with the Council on American-Islamic Relations and was known as CAIR-CAN until last year, when it changed its name.
CAIR spokesman Ibrahim Hooper said a court ruling in favor of the council, which is independent from CAIR in the United States, could have an impact in the U.S.
"If the Canadian organization is able to prove there was defamation," Hooper said, "that might make Islamophobes think twice before making this baseless claim."