Germany has announced plans to reduce the size of its army by around 10%.
The army is being made more suitable for deployment overseas
Under the proposals, troop strength will be cut to around 250,000 by 2010 and a large number of military installations will be closed down.
About 40,000 civilian support jobs will also be cut as part of the attempt to save money and adapt to new conditions.
German Defence Minister Peter Struck an army designed to confront Soviet forces in the Cold War was no longer what Germany needed.
"Our goal is to develop the Bundeswehr into a modern army of the 21st Century," he said.
"But this new course makes further hard steps necessary. The basic rule is quality not quantity."
The German military is already in the midst of a major overhaul intended to transform it into a leaner, more modern force, better suited to deployment outside Germany.
It currently has 9,000 troops overseas, ranging from peacekeeping missions in
Afghanistan and the Balkans to patrolling shipping lanes
off the Horn of Africa.
Proposed 2010 strength - 250,000
Civilian staff to be cut by 40,000
24 billion euro budget
The latest plans are based on findings by an independent commission led by former German president Richard von Weizsaecker, which called for similar cuts three years ago.
Mr Struck's predecessor, Rudolf Scharping, implemented smaller cuts.
But the current minister is constrained by a budget capped at just over 24 million euros, and has had to plan further reductions.
The measures include a projected increase in the number of professional troops, to 195,000 according to some media reports.
This would leave just 55,000 conscripts, meaning that only a selection of those eligible would be called up.
Correspondents say this is likely to re-ignite a debate about conscription, as some regard such a system as unfair.
The ruling coalition's junior partners, the Greens, want military service to be scrapped altogether.