Shell-shocked veterans will have their post-combat trauma eased by a half-billion-dollar expansion of the Australian War Memorial, according to the institution's outgoing director.

Key points: The Federal Government has pledged $500 million for an expansion of the Australian War Memorial

The Federal Government has pledged $500 million for an expansion of the Australian War Memorial It includes a doubling of the exhibition space to showcase Australia's recent military history

It includes a doubling of the exhibition space to showcase Australia's recent military history Director Brendan Nelson insists it will help people dealing with, and prevent, PTSD

Brendan Nelson, who ends his term this year, believes a key contributor to post-traumatic stress disorder (PTSD) is a lack of proper recognition of military service.

"If we are to deal with and to prevent post-traumatic stress, [it's important] that no young serviceman or woman or their family feels that what they have done doesn't count," Dr Nelson said.

"One of the key contributors to post-traumatic stress is the sense that your country doesn't know and doesn't care about what you did".

The former defence minister made the comments after joining Prime Minister Scott Morrison to publicly unveil plans for the Memorial's redevelopment.

An artist's impression of the proposed $500 million expansion to the Australian War Memorial. ( Supplied: Australian War Memorial )

As part of the nine-year development, a new cavernous, underground exhibition hall will be built to house recently acquired military items such as helicopters and jet fighters.

In March, dozens of prominent Australians, including a former memorial director, signed a letter opposing the $500 million expansion, arguing the money could be better spent on veterans and their families.

Dr Nelson sought to answer this criticism following the unveiling of detailed plans for the contentious project.

"Not a cent of this money comes from the Veterans' Affairs budget, not a cent from the defence budget," he said.

"Every story, every operation that's done by these Australians, we are proud of it and the stories will be told here at the Memorial thanks to the support and investment of the Australian Government".

Brendan Nelson insists an expansion to the Australian War Memorial will help soldiers battling PTSD. ( ABC News: Jordan Hayne )

Mr Morrison also praised Dr Nelson's time as director and compared his legacy to Australian war historian Charles Bean, who helped establish the War Memorial following World War I.

"He has been a truly great director. I'm sure none of us would say there'll be one greater than Charles Bean — but Brendan stands amongst the greatest," he said.

The ABC understands Dr Nelson's replacement will be announced in the coming days.