Tenet publicly revealed how US intelligence shamed the man who gave Pakistan the bomb, and is accused of leaking nuclear secrets to Libya, North Korea and Iran.
"Our spies penetrated the network through a series of daring operations over several years," said Tenet in a speech at Georgetown University designed to defend the Central Intelligence Agency's data used to justify the Iraq war.
"Through this unrelenting effort, we confirmed the network was delivering such things as illicit uranium centrifuges."
Tenet spoke at Georgetown University hours after Pakistani President Pervez Musharraf pardoned Khan, who begged for forgiveness in a sensational television interview.
The father of Pakistan's nuclear program was "shaving years off the nuclear weapons development timelines of several states, including Libya," Tenet said.
"Khan and his network have been dealt a crushing blow and several of his senior officers are in custody," said Tenet.
"Malaysian authorities have shut down one of the network's largest plants. His network is now answering to the world for years of nuclear profiteering."
CIA agents, working with British spies pieced together a picture of the network revealing subsidiaries, scientists, companies, agencies and manufacturing plants on three continents, he said.
Musharraf on Thursday called Khan a "national hero" for developing Pakistan's nuclear bomb, but said he had made "mistakes".
He said "money" was the motivation for Khan's actions, and those of five other nuclear scientists arrested following a probe into the nuclear leaks and promised that "no military or government official was involved" in the leaks.
The United States, which has been quietly pushing its anti-terror ally Pakistan for years over allegations its nuclear expertise was helping its US foes to develop weapons programs, said it was satisfied with the probe into Khan.
"We think that Pakistan is taking serious efforts to end the activities of a dangerous network," said State Department spokesman Richard Boucher.
"It's up to the government of Pakistan to take the necessary measures to ensure that this kind of proliferation will not happen again."
Mohamed ElBaradei, head of the UN International Atomic Energy Agency told reporters that Khan's operation was the "tip of an iceberg" in the sale of nuclear secrets.
He said Pakistan has been "quite cooperative so far" with the IAEA in trying to piece together "a supermarket" of international smuggling of nuclear materials and information such as weapons blueprints the United States has found in Libya.
He said the IAEA, was able to gather information from Libya and Iran, where it is verifying compliance with international safeguards, about how Khan and others helped them acquire nuclear technology.
The IAEA set off the Khan scandal when it alerted Pakistan last year that Iran had blueprints for centrifuges that were similar to ones Pakistan had used in building the bomb and which Khan acquired when he worked in the Netherlands in the 1970s.
Now, said ElBaradei: "We're looking into who else got ... materials, other than Libya or Iran."
He said individuals in at least five countries were involved in trafficking that went back at least to the 1980s.
Khan "was an important part of the process. Now he's cooperating with Pakistani authorities so hopefully we'll get as much information as we need," ElBaradei said.