Both sides signed a memorandum of understanding to develop renewable energy projects near military installations and on U.S. public land designated for defense purposes.
"Energy security is critical to our national security," said Interior Secretary Ken Salazar in a statement.
The aim of the memorandum is to harness 1 gigawatt of renewable energy for the Defense Department by 2025. The U.S. Defense Department, the statement notes, pays about $4 billion per year on conventional utilities.
"Developing renewable energy is the right thing to do for national security as well as for the environment and our economy," Defense Secretary Leon Panetta said in a statement.
The MOU announcement didn't include financial terms. Some U.S. lawmakers have expressed frustration with renewable energy programs that include the Defense Department, saying efforts should focus on direct national security needs.