Federal News
Trump Directs Federal Agencies to Halt Anthropic AI
March 23, 2026
The former President Donald Trump has issued a directive for all federal agencies to immediately cease use of Anthropic's AI technology, initiating a six-month phase-out period mandated by the Department of Defense amid national security concerns. This directive follows the Pentagon's designation of Anthropic's AI as a supply chain risk and its preference for Elon Musk's competing AI, Grok. Concurrently, the Trump administration is advancing a controversial AI contract clause requiring vendors to permit government use of their AI for any lawful purpose, raising concerns about the removal of safety and privacy safeguards. These developments have created operational uncertainty within federal agencies, potential legal challenges, and significant implications for AI vendors competing in the federal market.
- The Department of Defense's $200 million contract with Anthropic is under scrutiny, with Pentagon officials enforcing a phase-out deadline that may disrupt existing AI deployments.
- Procurement professionals should anticipate increased scrutiny of AI supply chain risks and evolving contract clauses that may affect vendor compliance and liability.
- AI technology providers must evaluate the impact of the new federal contracting clause on intellectual property and safety protocols.
- Agencies and contractors should prepare for potential operational disruptions and costs associated with transitioning away from Anthropic's AI solutions within the six-month timeline.
I am directing EVERY Federal Agency in the United States Government to IMMEDIATELY CEASE all use of Anthropic's technology. We don't need it, we don't want it, and will not do business with them again!
— Donald Trump, US President
There is a tension there that has to be balanced. We have to be secure but not stifle innovation. I donโt think that stifling innovation is GSAโs aim. They want innovation from commercial companies and want to build industrial base and be a leader. But itโs the delicate balance of how you bring security along without limiting the industrial base.
— Rebecca Pselos
Should a subcontractor say they are using Anthropic, agencies would have to terminate that subcontract and go out and find a new one, which carries with it a cost.
— Franklin Turner, Co-chair, Government Contracts Practice Group, McCarter & English
Agencies
Department of Defense, Pentagon, General Services Administration, United States Federal Agencies, United States Government
Vendors
Anthropic, Grok, OpenAI, Palantir
Contracts
, $200 million
Locations
Sources
- Trump directs federal agencies to eliminate Anthropic technology amid Pentagon dispute · MSN · Mar 21
- We don't need it: Trump orders halt to Anthropic AI, sets six-month phase-out · MSN · Mar 21
- โNobody really knows:โ Pentagon clash with Anthropic throws agencies into limbo · AOL.com · Mar 23
- The Trump administrationโs AI message is sending mixed messages | Federal News Network · Federal News Network · Mar 23
- Trump administration clouds up its push for AI in government | Federal News Network · Federal News Network · Mar 23