Up to 800 civilian and military jobs will be axed, including some in the Midlands, under a proposed merger of two major defence agencies, the Government announced.
Defence Secretary Des Browne pledged that compulsory redundancies would be avoided where possible.
The shake-up is intended to boost efficiency and ensure soldiers fighting on the front line are better equipped.
Under the plans, the Defence Procurement Agency (DPA) and the Defence Logistics Organisation (DLO) will become an integrated body.
The chiefs of both agencies will create the new organisation, which will be based at three sites in Bristol and Bath, from April 2007.
It will have responsibility for the procurement, maintenance and containment of military equipment.
About 360 civilian jobs will go in the merger which is expected to produce savings of £200 million over 25 years. A further 100 military posts will be "civilianised" as the DLO withdraws from various sites over the next five years.
The merger will also see about 2,000 existing posts relocated from sites across the south of England.
Numbers will be reduced at RAF Wyton in Huntingdon, Cambridgeshire, and the DLO will withdraw entirely from Andover South in Hampshire, Sapphire House in Telford, Shropshire, RAF Brampton in Cambridgeshire, Caversfield
in Oxfordshire and Sherborne in Dorset. Mr Browne also confirmed that the vacated Andover South site is the option for the Land Forces HQ.
This will be created by integrating Land Command HQ, in Wilton, near Salisbury, with the Adjutant General's HQ at Upavon, Wilts.
About 240 civilian and 100 military posts will also be cut in the move to the Andover site which is expected to be fully operational from April 2009.
In a further move, the Defence Secretary has approved plans to relocate staff at RAF Brampton not affected by the merger to RAF Wyton. Up to 100 jobs - expected to be mostly civilian contractors - will be axed.
The proposals come in a report, Enabling Acquisition Change, which arises from last year's defence industrial strategy. They will be subject to formal trades union consultation. However, union leaders warned of possible industrial action following yesterday's announcement.
The Public and Commercial Services Union and Prospect pledged to fight the proposals which it said were being "forced through" with little consultation.
General secretary Mark Serwatka said: "The lack of consultation over these plans has been disgraceful and represents a triple whammy for staff who face losing their job, having to move to another part of the country or yet more privatisation." ..SUPL: