The announcement came in a joint virtual press conference between US President Joe Biden, UK Prime Minister Boris Johnson. His Australian counterpart Scott Morrison has also attended.
The new deal will let Australia build nuclear-powered submarines for the first time, using technology provided by the US.
The Aukus pact, which will also cover AI and other technologies, is one of the countries’ biggest defence partnerships in decades, analysts say.
China’s First Reaction
China has condemned the agreement as “extremely irresponsible”.
Foreign ministry spokesman Zhao Lijian said it “seriously undermines regional peace and stability and intensifies the arms race”.
China’s embassy in Washington accused the countries of a “Cold War mentality and ideological prejudice”.
The pact also created a row with France, which has now lost a deal with Australia to build 12 submarines.
“It’s really a stab in the back,” France’s Foreign Minister Jean-Yves Le Drian told France Info radio.
The three leaders referred repeatedly to regional security concerns which they said had “grown significantly”.
The US and China have earlier exchanged accusations over the origins of the coronavirus pandemic.
Chinese media sources have alleged that the Covid-19 virus originated from an American military base in Maryland.
Furthermore, the claims has gained popularity in China ahead of a US intelligence report on the virus origins.
On the other hand, the US report has shed light on whether the virus was the result of a natural spillover from animals to humans or not.
Thus, a summary of the report is expected to be published in the coming days.