Panetta formally ended the ban on female U.S. soldiers serving in combat units Thursday, opening approximately 230,000 military jobs, including serving on the front lines.
"Women have shown great courage and sacrifice on and off the battlefield, contributed in unprecedented ways to the military's mission and proven their ability to serve in an expanding number of roles," Panetta said at the Pentagon. "The department's goal in rescinding the rule is to ensure that the mission is met with the best-qualified and most capable people, regardless of gender."
President Barack Obama praised Panetta's decision, noting women already serve in non-combat units such as military police or as truck drivers that expose them to danger.
"Today, by moving to open more military positions -- including ground combat units -- to women, our armed forces have taken another historic step toward harnessing the talents and skills of all our citizens," the president said in a statement.
"Earlier today I called Secretary of Defense Panetta to express my strong support for this decision, which will strengthen our military, enhance our readiness, and be another step toward fulfilling our nation's founding ideals of fairness and equality."
Retired Col. Jack Jacobs called the change a "watershed moment."
"When people are trying ardently to kill you, it really doesn't matter to you who is on to the left and on your right as long as they're doing their job," Jacobs said on NBC's "Today" show.
Former Chairman of the Joint Chiefs of Staff Gen. Richard Myers, speaking on CBS' "This Morning," cautioned that some things wouldn't change.
"I think the one thing they'll probably look at is not changing training standards to accommodate women," he said. "When we brought women fighter pilots into the Air Force, we didn't change our training standards, and women are totally accepted as part of the crew force in bombers and fighters and so forth."
Some 73,915 women currently are on active duty in the military. More than 150 female soldiers have been killed in action in Iraq and Afghanistan.