Levin, chairman of the Armed Services Committee, speaking Sunday in an interview on NBC News' "Meet the Press," said Morsi has the potential to be a positive force in the Middle East.
"Even though there's great concern, I think we have to be very cautious," Levin said. "We don't obviously want to see a democratically elected autocrat take the place of an undemocratically elected dictator, which was the case before that. On the other hand, there are some real pluses that are possible here.
"If Egypt takes some real responsibility for making the cease-fire work, we'll stop those missiles from going through those tunnels into Gaza and they seem to be moving in that direction. That can make a real difference in terms of what's going on in Gaza ... ."
Levin said President Obama should point out U.S. concerns about the political situation in Egypt, "but at the same time he's got to point out that behind all of this is Iran."
"Iran's support of Hamas, Hezbollah, Syria and the way that it has been filtered into weaponry that goes through Egypt, into Gaza, if that can be stopped, by Egypt, and if Iran can get a message that the missiles are not going to succeed against Israel ... that is going to take leverage away from Iran."
"Keep pulling the world together against Iran," Levin said. "That's the source of the problem."