The USGS found the rare earth elements in about one-quarter of a square mile in deposits in Helmand. A 2007 survey found an estimated 1.5 million metric tons of potential rare earth resources in southern Afghanistan.
"This is just one more piece of evidence that Afghanistan's mineral sector has a bright future," Regina Dubey, acting director of a U.S. Defense Department business and stability task force, said in a statement.
The international community gets more than 95 percent of its rare earth minerals from China. Rare earths are used in a range of products high-strength magnets to alloys for batteries.
U.S. Special Representative for Afghanistan and Pakistan Marc Grossman said Washington was ready to help back Kabul in its efforts to exploit its natural resources.
"The potential that these findings have for the future well-being of the Afghan people is significant," Grossman said.
U.S. defense officials estimated in 2010 that there could be as much as $1 trillion worth of iron, copper, cobalt, gold and lithium in Afghanistan.