British forces are to hand over responsibility for part of Helmand province to US forces over the next few weeks.
Defence Secretary Bob Ainsworth said transferring control of Musa Qaleh district was the "logical next stage" as the American troop surge came into effect.
He told MPs: "The transfer will allow UK troops to be redeployed from Musa Qaleh to central Helmand, the most heavily-populated area of the province, where the majority of our troops are already based."
Mr Ainsworth said the "rebalancing" was possible because Nato forces in Helmand had increased from around 7,700 to more than 20,000 over the past year.
The decision was taken by the alliance's top commander in Afghanistan, US General Stanley McChrystal, after consulting with Britain's General Nick Carter.
Mr Ainsworth said further changes were likely "in due course" to ensure the military presence had the "greatest effect in countering the threat posed by the insurgency and protecting the civilian population".
"The thickening of our force density in central Helmand will allow us to continue the progress over the last 12 months in increasing our emphasis on partnering and training the Afghan National Security Forces and will reaffirm our central role in delivering General McChrystal's population-focused counter-insurgency approach, both of which are key elements of (the) strategy to defeat the insurgency and build a stable and secure Afghanistan," he added.
Some 23 UK service personnel have been killed in Musa Qaleh since forces were first deployed there in 2006.
Mr Ainsworth said: "Through their professionalism and courage, and that of their colleagues, insurgent activity in the district centre has been contained, the authority of the legitimate Afghan government has been reinforced, and there has been steady progress on governance and development, especially in the last 12 months, as the daily lives of its citizens have been improved.
"While responsibility for security will now transfer to US forces, the UK will remain committed to building on the progress of development through the ongoing activities of the UK-led Helmand Provincial Reconstruction Team in Musa Qaleh."