The case has bolstered fears that Americans and other Westerners are heading to Pakistan to link up with al Qaeda and other militant groups, and it could test a U.S.-Pakistani relationship already made brittle by demands in the war in neighboring Afghanistan.
The young Muslim men, who are from the Washington, D.C., area, have not yet been formally charged with any crime.
However, police are now alleging that the men were collecting and attempting to collect material to carry out terrorist activities in the list of recommended charges to be presented to a court, police official Nazir Ahmad said.
Those charges fall under sections of Pakistan's anti-terrorism law.
The men appeared before a magistrate in the Punjab province town of Sargodha on Friday. Police were given 10 more days to hold them and further investigate, said Ansar Ahmad, another Sargodha police official.
The five were arrested in Sargodha earlier this month, but are being held in Lahore, the provincial capital.
Police earlier accused them of trying to link up with militant groups and intending to go fight in Afghanistan. The detainees are accused of using the Facebook and YouTube Web sites to try to connect with extremist groups in Pakistan and are said to have established contact with a Taliban recruiter.
Officials in both countries have said they expected the men would eventually be deported back to the United States, but the latest development muddies the picture on when that would happen.
The men were picked up by Pakistani authorities after their worried families in the U.S. turned to the FBI to track them down.
Pakistan officials have said those detained included three Pakistani Americans, two Ethiopian Americans and an Egyptian American named Ramy Zamzam, who is a dental student at Howard University in Washington.
The others were identified as Waqar Hussain, Aman Yamar, Ahmad Abdul Mimi and Umer Farooq. Pakistani officials have given various spellings of their names.
FBI agents have been granted some access to the men. The agency is looking into what potential charges they could face. Possibilities include conspiracy to provide material support to a terrorist group.
Pakistan is under U.S. pressure to do more to root out militant groups that use its soil to plan attacks against Western troops across the border in Afghanistan.
Early Friday, the Pakistani army used helicopter gunships to kill at least nine suspected militants and destroyed their hideouts in the northwest's Orakzai tribal region near the Afghan border, government official Mohammed Yasin said.
Many Pakistani Taliban fighters are believed to have fled to Orakzai since the army launched a major offensive against them in the South Waziristan tribal region in October.
Prime Minister Yousuf Raza Gilani has also hinted the army will pursue a full-scale offensive in Orakzai. The U.N. says around 40,000 people have already fled the region.