But despite comments from the bench, there was no clear majority to indicate how the justices will rule. A decision should be handed down in several months.
Oregon voters passed the Death With Dignity Act in 1994, allowing physicians to dispense medication to assist patients with terminal diseases to commit suicide.
However, the Justice Department argues the federal Controlled Substances Act gives the attorney general the power to prohibit the use of drugs in assisted suicide, regardless of state law.
A three-judge appeals court panel ruled Congress did not target assisted suicide in the Controlled Substances Act, therefore the department cannot block the Oregon law.
In asking for review, the Justice Department told the Supreme Court its reading of the federal law is a "reasonable" interpretation, and the appeals court decision conflicts with Supreme Court and other court precedent.
A 1997 decision allowing states to outlaw assisted suicide, written by the late Chief Justice William Rehnquist, seemed to suggest that states should decide the matter for themselves.
However, a new court under new Chief Justice John Roberts might take a different tack.
Wednesday, Roberts' comments indicated he was supporting the Justice Department argument, analysis by scotusblog.com said.