Washington: The US Department of Defense has awarded OpenAI a $200 million contract to develop advanced artificial intelligence tools aimed at strengthening national security.
Under the terms of the agreement, OpenAI will deliver prototype AI systems designed to support both military operations and broader defense enterprise functions. The initiative marks a significant step in integrating frontier AI technology into US defense strategy.
“Under this award, the performer will develop prototype frontier AI capabilities to address critical national security challenges in both warfighting and enterprise domains,” the Pentagon said.
The majority of the work will be carried out in and around Washington, D.C., with the contract scheduled to run through July 2026.
The deal arrives as OpenAI experiences a sharp acceleration in business growth. The Microsoft-backed company recently reported a $10 billion annualized revenue run rate as of June, driven by the surging global demand for AI tools like ChatGPT.
In April, the White House’s Office of Management and Budget issued new guidelines to promote a competitive and responsible AI marketplace across federal agencies.
However, those rules specifically exempted national security and defense systems, creating space for rapid development of military-grade AI technologies without regulatory delays.
The Pentagon’s partnership with OpenAI reflects a broader shift in defense procurement, where government agencies are increasingly turning to private sector leaders in AI to bolster national capabilities.
The contract is one of the most high-profile examples of commercial AI deployed in the interest of US military readiness and strategic advantage.
