ABOARD THE USS GEORGE WASHINGTON—Relations between the U.S. and Chinese militaries have improved "modestly" in the past year, a senior U.S. Navy official said, despite discord over territorial tensions and strategic issues in the Asian-Pacific region.

The comments by Rear Admiral Mark Montgomery, who leads an aircraft-carrier battle group that operates mainly in Asian waters, came just weeks after senior U.S. and Chinese defense officials traded barbs at a regional security summit over Beijing's perceived assertiveness...