Spokesman Hong Lei told a routine press briefing on Tuesday that if the bill become a law, it will have "serious consequences." He did not elaborate.
China is firmly opposed to the bill because it violated basic norms of international relations, according to Hong.
"We urge the US Congress to stop considering the bill," Hong said, adding the Chinese side also hopes the United States Administration will end the "political farce."
The bill wants to rename the street after Liu, a Chinese man sentenced to 11 years in prison on Dec. 25, 2009, after a Beijing court convicted him of violating Chinese law and engaging in activities aimed at overthrowing the government.