The agreement between president Barack Obama and premier Julia Gillard was immediately challenged by China, concerned America is seeking to cage it in.
Beijing suggested strengthening military alliances in the region ran counter to attempts to build economic co-operation.
Mr Obama, at a joint news conference with Ms Gillard in Canberra, said: “With my visit, I am making it clear the United States is stepping up its commitment to the entire Asia-Pacific region.”
From next year, US troops and aircraft will operate out of Darwin, only 500 miles from Indonesia, able to respond quickly to any humanitarian and security issues in South-east Asia, where disputes over sovereignty of the South China Sea are causing rising tensions.
Mr Obama added: “It is appropriate for us to make sure … that the security architecture for the region is updated for the 21st century and this initiative is going to allow us to do that.”
He stressed that it was not an attempt to isolate China, which is concerned that Washington is trying to encircle it with bases in Japan and South Korea and now troops in Australia.
Mr Obama said: “The notion that we fear China is mistaken. The notion that we are looking to exclude China is mistaken.”
He also stressed that China was not being excluded from a planned Trans-Pacific Partnership on trade. He added: “We welcome a rising, peaceful China. But China’s rising power means it must take on greater responsibilities to ensure free trade and security in the region.
“It’s important for them to play by the rules and, in fact, help underwrite the rules that have allowed so much remarkable economic progress.”
The US deployment to Australia, the largest since the Second World War, will start next year with a company of 200-250 marines in Darwin, the “Pearl Harbour of Australia”, Ms Gillard said. More bombs were dropped on Darwin during a surprise Japanese raid than on Pearl Harbour in Hawaii, the incident that brought the US into the Second World War.
A total of 2,500 US troops will rotate through the port city. The US will bring in ships, aircraft and vehicles, and increase military training.
Asked about the US-Australian plan, Chinese foreign ministry spokesman Liu Weimin said China stood for “peaceful development and co-operation”.
He said: “We also believe the external policies of countries in the region should develop along these lines.”
But he added, “whether strengthening and expanding a military alliance is in the common interests of the region and the international community is worthy of discussion”.
Other Asian nations are likely to welcome the US move as a counterbalance to China’s growing military power.
“The US hopes to militarily strengthen alliance relations with Japan in the north and with Australia in the south, with the clear intention of counter-balancing China,” Su Hao, director of Asia-Pacific research at the Foreign Affairs University in Beijing, told the Global Times, a state-backed newspaper.