US Defence Secretary James Mattis says countering China's rapidly expanding military and an increasingly aggressive Russia are now the main focus of America's national security, outpacing the threat of terrorism.

Key points: James Mattis says the IS group still poses threat across the globe

James Mattis says the IS group still poses threat across the globe He says US and its allies are stronger together

He says US and its allies are stronger together Sergey Lavrov says US tries to prove leadership through confrontational strategies

For almost two decades, ever since the September 11, 2001 attacks, America's military focus has been on fighting terrorism, and counter-insurgency campaigns in Afghanistan, Iraq and Syria.

Mr Mattis has unveiled a broad new strategy for the Defence Department, warning that all aspects of the military's competitive warfighting edge have eroded.

He said building a force that can deter war with established and emerging military powers in Moscow and Beijing, and US enemies such as North Korea and Iran, would require increased investment to make the military more lethal, agile and ready to fight.

"We face growing threats from revisionist powers as different as China and Russia, nations that seek to create a world consistent with their authoritarian models," he said.

He said competition with those adversaries has threatened America's military advantage around the world.

"We will continue to prosecute the campaign against terrorists that we are engaged in today, but great power competition — not terrorism — is now the primary focus of US national security," Mr Mattis said.

James Mattis has called for America to work closely with allies and partners. ( Reuters: Gleb Garanich )

He said the Islamic State group's (IS) "physical caliphate" in Iraq and Syria had been defeated, but that IS, al-Qaeda and other extremists still posed threats across the globe.

Mr Mattis repeated his call for America to work closely with allies and partners — an approach that aligns more closely with previous administrations than President Donald Trump's "America First" ideas.

He said the US and its allies were stronger together.

The most dominant theme in his strategy was for the US to regain its competitive edge with China and Russia, according to an 11-page, unclassified version released by the Pentagon.

That shift reflects persistent US worries about China's military build-up in the South China Sea, its moves to expand its political and economic influence, and what has been described as Beijing's systematic campaign of cyberattacks and data theft from government agencies and private US corporations.

The shift also underscores broad American concerns about Russia, given Moscow's takeover of Ukrainian territory, involvement in Syria's war and alleged meddling in the 2016 US presidential election.

James Mattis warned that all aspects of the US military's competitive warfighting edge have eroded ( AP: Lee Jin-man, file )

Russia accuses US of being confrontational

Previous defence chiefs long warned about China, and the Obama administration put a greater focus on the Asia-Pacific region, including by adding ships and troops.

Derek Chollet, former senior Pentagon official in the Obama administration, said much of the strategy is "old wine in a new bottle, but in this context, that's a good thing".

Russia's Foreign Minister Sergey Lavrov dismissed the new US stance.

He said militaries frequently wanted more resources, but "it is regrettable that instead of having normal dialogue, instead of using the basis of international law, the US is trying to prove their leadership through such confrontational strategies and concepts".

He said Moscow was open to discuss military doctrines and the kind of military contacts that previously existed between the two countries.

North Korea's nuclear threat is a focus of US national security ( AP/KCNA )

However, the deputy assistant defence secretary for strategy, Elbridge Colby, said the US still sought areas of cooperation with Russia and China, stressing "this is not a strategy of confrontation".

The US has pushed China to increase pressure on North Korea to abandon its nuclear ambitions.

Washington has maintained talks with Russia to ensure no conflicts or accidents in the sky over Syria, where both nations are bombing IS fighters.

The strategy, however, faces grim budget hurdles. And Mr Mattis criticised Congress for budget caps that have done more to erode military readiness than any other enemy since 9/11.

"For too long we have asked our military to stoically carry a 'success at any cost' attitude, as they work tirelessly to accomplish the mission with now inadequate and misaligned resources, simply because the Congress could not maintain regular order," he said.

Politicians have been deadlocked on a spending bill, bringing the federal government to the brink of a shutdown at midnight on Friday (4:00pm AEDT).

ABC/AP