US President Donald Trump urged "new solutions to new circumstances" for the alliance after meeting NATO Secretary-General Jens Stoltenberg. He also repeated his calls to allies to pay their "fair share" for defense.
Trump has pledged to work on "upgrading" NATO and making it more suitable to modern challenges like migration and terrorism.
Appearing alongside Stoltenberg at a Washington press conference on Wednesday, Trump reaffirmed America's commitment to the alliance.
The US President also praised changes NATO has made in fighting terror.
"I said it was obsolete," Trump said, referencing his widely publicized campaign statement. "It's no longer obsolete."
Speaking about his upcoming visit to Brussels, Trump stressed that every generation needed to find a way to adapt NATO to their times.
"We must not be trapped by the tired thinking that so many have, but to apply new solutions to face new circumstances throughout the world," he said.
NATO chief Stoltenberg praised America's role in NATO, specifically mentioning the troops the US recently deployed in Eastern Europe. He also lauded NATO's contributions to the US, saying that no other superpower ever had such backing.
Thanks to NATO, "America has the best friends and allies in the word," he said.
Paying 'what they owe'
Both Stoltenberg and Trump urged other NATO countries to raise their defense spending to the recommended target of 2 percent of GDP.
"In facing our common challenges, we must also ensure that NATO members meet their financial obligations and pay what they owe," Trump said. "Many have not been doing that."
"If the other countries pay their fair share instead of relying on the US to make up the difference, we would all be much more secure and our partnership would be made that much stronger."
'It would be wonderful' to get along with Russia
In an apparent jab at Russia, President Trump also criticized the use of chemical weapons in Syria, which the West blames on the Syrian regime allied with Moscow.
"The vicious slaughter of innocent civilians with chemical weapons, including the barbaric killing of helpless small children and babies must be forcefully rejected by any nation that values human life," he said.
However, the president remained elusive when asked about future relations between Washington and Moscow, saying that he was waiting to hear from Secretary of State Rex Tillerson. The State Department chief is currently visiting Russia.
"It would be wonderful if NATO and our country could get along with Russia," he told reporters. "(Vladimir) Putin is the leader of Russia, Russia is a strong country, the US is a very strong country and we will see how it all works out," he said.