British troops in the Sangin area of Afghanistan's Helmand province are to be replaced by US forces, the UK's Defence Secretary Liam Fox has said.
The UK has suffered its heaviest losses in the area, with 99 deaths since 2001.
About 1,000 Royal Marines are expected to leave and be redeployed to central Helmand by the end of 2010.
The military insists the move is a redeployment, now there are more US troops on the ground, but the Taliban are certain to portray it as a defeat.
Last month Britain handed over command in Helmand to a US general.
Maj Gen Richard Mills, of the US Marine Corps, assumed control of all Nato-led International Security Assistance Force (Isaf) troops in Helmand on 1 June.
Dr Fox told MPs UK forces had made "good progress" in Sangin, but the move would enable Britain to provide "more manpower and greater focus" on Helmand's busy central belt, leaving the north and south to the US.
"The result will be a coherent and equitable division of the main populated areas of Helmand between three brigade-sized forces, with the US in the north and the south, and the UK-led Task Force Helmand, alongside our outstanding Danish and Estonian allies, in the central population belt," he told the Commons.
About 300 logistic and security troops - from the Theatre Reserve Battalion stationed in Cyprus - would be sent to Helmand to help with the redeployment, he said.
The Theatre Reserve Battalion for Afghanistan is currently provided by the 2nd Battalion, The Duke of Lancaster's Regiment.
Dr Fox also told MPs a stable Afghanistan was "vital to national security" .
Speaking at prime minister's questions, David Cameron told MPs this was the "key year" to step up the military and political pressure in the country.
"It's time to maximise the pressure now and then bring our forces home as we train up the Afghan army and police force to do the job that needs to be done," he said.
UK forces should not be there in a "combat role, or in significant numbers" in five years time, he added.
Earlier, Conservative MP and former British army officer Patrick Mercer said the handover was a routine move and should under no circumstances be considered a retreat.
"Any suggestion that British forces are being beaten out of Sangin or returning with their tails between their legs is not just disingenuous, it's actually disgusting," he told the BBC.
Of the 312 UK deaths in Afghanistan since 2001, a third have taken place in Sangin, currently home to 40 Commando Royal Marines.
Col Stuart Tootal, who commanded the first UK battle group of of 1,200 soldiers sent into Sangin four years ago said the number of deaths that had taken place in Sangin meant there was a lot of "emotion" attached to the area.
He said: "It makes no sense from a logistic and command point of view to keep a British battle group away from its main brigade when it's now an American area and there are American troops to take over from them.
"This reflects good practical military sense and we shouldn't allow emotion or misinterpretation to be put above that."
Ian Sadler, whose son Jack, 21, died north of Sangin in December 2007, said the US takeover would allow British troops to "consolidate" and "build a better base... in a smaller area influence".
"This is a Nato exercise, it's not the British out there fighting separately to the Americans, the Polish, the Canadians, we're all out there together," he told the BBC.
Sangin is the latest part of the province to be handed over to US control after the town of Musa Qaleh in March and the Kajaki dam last month.
It has witnessed some of the fiercest fighting the British military has endured since World War II, and contains a mix of rival tribes.
It is also a volatile northern district at the heart of the opium-growing industry.
The UK's 8,000 forces in Helmand are greatly outnumbered by the 20,000 US Marines sent there by President Barack Obama.
Meanwhile, the Ministry of Defence has named a soldier who was killed on Monday by a roadside bomb in the Nahr-e Saraj district of Helmand province as Trooper James Anthony Leverett, 20, of the Royal Dragoon Guards.