The Pentagon plans to scale back the US Army by more than an eighth to its lowest level since before World War II, as it hopes for an end to 13 years of war in Afghanistan.
Defence Secretary Chuck Hagel recommended shrinking US forces from 520,000 active duty troops to between 440,000 and 450,000.
In a speech outlining the proposed defence budget Monday, he said that after Iraq and Afghanistan, military leaders no longer plan to "conduct long and large stability operations".
If approved by Congress, the move would reduce the army to its lowest levels since 1940, before the American military dramatically expanded after entering World War II.
The proposed 13 per cent reduction in the army would be carried out by 2017, said a senior defence official, who spoke on condition of anonymity.
The move comes amid growing fiscal pressures and after years of protracted counter-insurgency campaigns, which saw the Army reach a peak of more than 566,000 troops in 2010.
US troops have already withdrawn from Iraq and President Barack Obama has promised to end America's combat role in Afghanistan by the end of this year.
The Pentagon had previously planned to downsize the ground force to about 490,000.
But Hagel warned that to adapt to future threats "the Army must accelerate the pace and increase the scale of its post-war drawdown".
He said the changes "would result in a smaller army, but would help ensure the army remains well-trained and clearly superior in arms and equipment".
Hagel also said the army national guard and reserves would be cut by five per cent.
The smaller force would entail some "added risk" but it would still be able to defeat an adversary in one region while also "supporting" air and naval operations in another, he said.
His comments confirmed the Pentagon has abandoned the idea of ensuring the army could fight two major wars at the same time.
The proposed budget also calls for scrapping the Air Force's entire fleet of A-10 "Warthog" aircraft and retiring the storied U-2 spy plane.
Instead, commanders have opted to invest more in the new F-35 fighter and the unmanned Global Hawk surveillance drone.
Hagel also called for slowing growth in pay and benefits, which make up nearly half the Pentagon's budget.
Military spending doubled after the attacks of September 11, 2001 but has started to decline as politicians push to slash the government's budget and debt.
Army leaders have been saying for months that they expect their service to shrink as the nation prepares to end its combat role in Afghanistan this year.
General Ray Odierno, the Army chief of staff, said recently that whatever the future size of the Army, it must adapt to conditions that are different from what many soldiers have become accustomed to during more than a decade of war. He said many have the misperception that the Army is no longer busy.
"People tend to think that the Army is out of Iraq and Afghanistan, and there is not much going on," he said January 23 at an Army forum. "The Army is not standing still. The Army is doing many, many, many things in order for us to shape the future environment and prevent conflict around the world."
The last time the active-duty Army was below 500,000 was in 2005, when it stood at 492,000. Its post-World War II low was 480,000 in 2001, according to historical tables provided by the Army on Monday. In 1940 the Army had 267,000 active-duty members, and it surged to 1.46 million the following year as the US approached entry into World War II.
Navy Rear Admiral John Kirby, the Pentagon press secretary, said that Hagel consulted closely with the military service chiefs on how to balance defence and budget-saving requirements.
"He has worked hard with the services to ensure that we continue to stand for the defence of our national interests that whatever budget priorities we establish, we do so in keeping with our defence strategy and with a strong commitment to the men and women in uniform and to their families, Kirby said.
"But he has also said that we have to face the realities of our time. We must be pragmatic. We can't escape tough choices. He and the chiefs are willing to make those choices," Kirby said.