Troops and equipment will be moved to northern Australia in a bid to make the army more prepared for combat in the region.
Major changes to the army will involve generalist units being restructured to specialist combat brigades, with hundreds of soldiers moving north.
The Darwin-based 1st Brigade will be light combat, while the 3rd Brigade based in Townsville will be armoured combat and the 7th Brigade in Brisbane a motorised unit.
A new 10th Brigade will also be set up in Adelaide that will focus on long-range firing capabilities, along with air and missile defence.
Townsville will hold all the army's armoured power and almost half its aviation capabilities including tanks, infantry fighting vehicles and Apache and Chinook helicopters.
Abrams tanks, M113 armoured personnel carriers, Hawkeis, Bushmasters and towed Howitzer artillery will be moved from Brisbane.
Darwin will be refocused towards light, agile and quick strike forces.
The changes stem from major findings from a landmark review into Australia's defence force, which found land forces needed a restructure.
Defence Minister Richard Marles said the changes would make sure Australia would have an army of the future.
"This is an important step for our army," he told reporters in Townsville, citing the three combat brigades stationed on northern bases.
"This builds an army which will be able to protect."
The restructure will relocate about 800 army personnel, with about 500 of those to be based in Townsville.
Adelaide won't see a return to current numbers until 2027 or 2028.
The restructure would take five to six years to fully implement, Mr Marles said.
"This is about making sure that we are leading the challenge that's been provided to us by the defence strategic review, having a focus on our forward bases," he said.
The changes would allow the defence force to be better resourced and get more utility from what it had, Acting Chief of Army Major General Richard Vagg said.
"We've got a unique opportunity with a number of new equipments starting to be delivered from next year, so we can position them at the point of need," he said.
"Adaptation is in army's DNA. As we adapt to this new structure, we'll have an army that is optimised for operations in the littoral environment."
Opposition defence spokesman Andrew Hastie has criticised some of the plans, saying the restructure put all Australia's eggs in one basket.
"We need to be investing in army, our people, and combat power, instead we are shrinking our land forces to one armoured brigade," he said.
"That means we only have one hand to play in a high-intensity conflict."
Shrinking armoured capabilities weakens Australia's combat power, he added.
"Only fools would rule out the use of armour in future ground wars, especially in the Indo-Pacific region," he said.
The acceleration and expansion of medium and heavy coastal manoeuvre vessels, capable of transporting land forces, are also being considered including water landing craft.
The vessels could be based in Darwin, northern Queensland and Brisbane.
American landing craft could also be stationed in Australia to help plug capability gaps.
