That's more than triple the 160 active duty and reserve NCOs released last fiscal year, Stars and Stripes reported Wednesday.
The 506 soldiers were being released because "the Army can no longer retain soldiers in over-strength skills as we improve grade and [Military Occupational Specialty]," Lt. Gen. Howard Bromberg, deputy chief of staff for personnel, said in an email.
He added the soldiers discharged under the Qualitative Service Program "are otherwise fully qualified for continued service" and that their selection "in no way diminishes their contributions to the Army."
Bromberg said he expects another 1,000 NCOs to be separated next year.
The discharge program was instituted in 2012 to retain those non-commissioned officers considered to have the greatest potential for continued service, the Army said in a statement. The service plans to release 80,000 soldiers by 2018.