The US is to partially lift its decades-old embargo on providing lethal military support to Vietnam, to help improve its maritime security.
The state department said it applied to weapons for maritime purposes only.
It followed talks between US Secretary of State John Kerry and his Vietnamese counterpart in Washington on Thursday.
Correspondents say it is aimed at countering China's actions around disputed islands in the South China Sea, but US officials have denied this.
The arms embargo was imposed on Vietnam in 1984. However, diplomatic ties between the US and Vietnam have been restored since 1995, 20 years after the Vietnam War ended.
State department officials said Mr Kerry informed Vietnamese Foreign Minister Pham Binh Min of the decision when they met for talks in Washington on Thursday.
He said that Washington was adjusting its current policy "in order to allow the transfer of defence equipment, including lethal defence equipment, for maritime security purposes only".
Spokeswoman Jen Psaki said sales of lethal maritime security capabilities would be on a case-by-case basis.
Vietnam is one of several nations currently engaged in territorial disputes with China over islands in the South China Sea. But Ms Psaki said the decision was not directed at China.
US officials said the decision followed some progress by Vietnam on human rights issues, but warned that a further easing of the embargo would require additional progress on this front.
Ties between the two countries have normalised over the past two decades, with bilateral trade now worth about $20bn a year.
The Vietnam War involving US combat forces lasted from 1965 to 1973 and killed hundreds of thousands of Vietnamese and 58,000 US soldiers.