Washington: US Defense Secretary Chuck Hagel has resigned, the first major cabinet change after Obama's Democrats were routed in mid-term elections three weeks ago.
Obama announced Hagel's resignation at a White House event on Monday morning in which he said Hagel, a Vietnam War veteran, has been no ordinary Secretary of Defence.
Hagel had struggled to improve his ties with Congress after a contentious 2013 confirmation hearing. Officials said he submitted his resignation letter after lengthy discussions with Obama that began in October.
On being Defence Secretary, Hagel said: "It's been the greatest privilege of my life."
"I will stay in this job until my successor is confirmed," added Hagel, who also thanked members of Congress for their support of US troops.
Hagel said he was grateful for Obama and Vice President Joe Biden's "friendship and leadership" and said he was proud of what they accomplished together as a team.
"It was a privilege to serve and lead ... I am indebted to the hard work of our armed services," he said.
Sen. John McCain of Arizona, a Republican, said: "Secretary chuck Hagel and I have had our difference over many years, but I have always considered him a friend, a patriot, and a dedicated public servant who has always put our country first and the needs of our men and women in uniform above his own."
Hagel had earlier raised questions about Obama's strategy toward Syria in a two-page internal policy memo he wrote that leaked.
In it, he warned that Obama's policy was in jeopardy due to its failure to clarify its intentions toward Syrian President Bashar al-Assad.
Obama has insisted that the United States can go after Islamic State militants without addressing Assad, who the United States would like to leave power.
Officials said Obama wanted fresh leadership during the final two years of his administration.
"What I can tell you is there are no policy differences in the background of this decision," a senior US defense official said.
"The secretary is not resigning in protest and he's not being 'fired'," the official said.
A senior White House official told the Washington Post that President Obama initiated discussions with Hagel about leavig in October.
Hagel is expected to remain in post until a successor is named, a US defense official said.
Top potential candidates to replace Hagel include Michele Flournoy, a former under secretary of defense, and Ashton Carter, a former deputy secretary of defense, who were rumored to be contenders for Hagel's job before he was named.
Senator Jack Reed, Democrat of Rhode Island, is another possible contender.
