In a televised speech to the nation, Bush said he would reduce U.S. force strength by 5,700 troops by Christmas and, by next July, reduce the number of combat brigades from 20 to 15, a decrease of roughly 30,000 troops.
The first step in that process will come later this month, when 2,200 Marines leaving Anbar province will not be replaced, the president said.
"The principle guiding my decisions on troop levels in Iraq is 'return on success' -- the more successful we are, the more American troops can return home," Bush said during a 17-minute address from the Oval Office.
"In all we do, I will ensure that our commanders on the ground have the troops and flexibility they need to defeat the enemy."
The top U.S. commander in Iraq, Gen. David Petraeus, and U.S. Ambassador to Iraq Ryan Crocker told Congress this week that progress had been made on the ground in Iraq since Bush in January sent 30,000 additional troops. The move was termed "the surge."
Petraeus said the surge campaign has met its military goals of reducing sectarian killings by more than 50 percent nationwide and by more than 80 percent in Baghdad.