President Joe Biden has hailed a "great day for America" as US officials said vaccinated people can go mask-less in most indoor and outdoor settings.
The president removed his mask in the Oval Office with Republican lawmakers as the guidance was being announced.
The advice still calls for wearing masks in crowded indoor settings like buses, planes and hospitals.
The Biden administration has faced pressure to ease restrictions on fully vaccinated people.
In another major step for the US in returning to pre-pandemic life, the president of the 1.7m-member American Federation of Teachers labour union called for schools to reopen fully in the autumn.
It comes after Pfizer's vaccine was approved for children aged 12 to 15.
The US coronavirus caseload has fallen to its lowest point since last September, with deaths at their fewest since last April.
According to the new guidance from the Centers for Disease Control and Prevention (CDC), physical distancing can also cease for the fully vaccinated.
Mr Biden, Vice-President Kamala Harris and staff went without facial coverings during a White House Rose Garden event to trumpet the new guidelines.
"We're not going to go out and arrest people," added Mr Biden, urging non-vaccinated Americans to wear masks.
His Twitter account posted: "The rule is now simple: get vaccinated or wear a mask until you do. The choice is yours." The US president has no power to order Americans to get vaccinated or wear masks.
The latest rules come with about 35% of Americans now fully vaccinated, though the roll-out has been losing momentum.
CDC Director Dr Rochelle Walensky said on Thursday at the White House: "Anyone who is fully vaccinated can participate in indoor and outdoor activities, large or small, without wearing a mask.
"If you are fully vaccinated, you can start doing the things you have stopped doing because of the pandemic. We have all longed for this moment, when we can get back to some sense of normalcy."
The guidance does not apply to healthcare facilities or places such as prisons and homeless shelters. Masks are also still advised for planes and other public transport.
The CDC's advice does not supersede local ordinances, and some businesses may still require customers and workers to wear masks.
In April, the CDC said masks can be avoided for most outdoor activities, but recommended their use in crowded settings.
Dr Walensky said that immuno-compromised people may want to consider continuing to wear a mask outdoors.
Big news from the CDC: If you’re fully vaccinated, you do not need to wear a mask – indoors or outdoors, in most settings.— The White House (@WhiteHouse) May 13, 2021
We’ve gotten this far. Whether you choose to get vaccinated or wear a mask, please protect yourself until we get to the finish line. pic.twitter.com/XI4yPmhWaD
The CDC defines "fully vaccinated" as two weeks after receiving a second jab of a two-dose vaccine, or two weeks after the single-dose Johnson & Johnson vaccine.
The move could alarm some Americans, with less than half of the population fully vaccinated and no way to confirm whether someone has received their shots or not.
President Biden has set a 4 July goal of vaccinating 70% of Americans with at least one jab. Around 250m jabs have been given so far, according to latest estimates.