US Defense Secretary Leon Panetta delivers a speech in the Great Hall of King's College in central London on January 18, 2013.
In a speech at Kings College London on Friday, Panetta said the alliance must reinvent itself and act against “Islamic militancy.”
“NATO can no longer be an alliance focused on a single type of mission, whether deterring the aggression of another superpower or conducting stability operations like Afghanistan,” he stated.
“To be prepared to quickly respond to a wider range of threats in an era of fiscal constraint, we must build an innovative, flexible, and rotational model for forward-deployed presence and training,” he added.
He said that "terrorists" who attack US interests will have less room to maneuver and conceal their efforts.
"Terrorists should be on notice that they will find no sanctuary, no refuge. Not in Algeria, not in North Africa, not anywhere," Panetta insisted.
He went on to say that US officials were "working around the clock" to secure the safe release of an unknown number of US citizens who have been taken hostage by militants at a gas plant near the Algerian town of In Amenas.
Panetta also noted that the new US defense strategy calls for a shift in focus to the Asia-Pacific region.
At the start of January, the Pentagon announced plans to cut defense spending by $487 billion over a decade and to reduce the number of US troops stationed in Europe.