Okinawans have long complained about the presence of US bases

Tokyo had objected to US calls for it to pay 75% of the estimated $10bn cost.

But after talks in Washington on Sunday, a deal was reached under which Tokyo will contribute $6.1bn to the cost of relocation to the US territory.

The dispute has held up agreement on overall realignment plans for the US military presence in Japan.

The agreement was due to have been finalised at the end of March.

Japanese Defence Minister Fukushiro Nukaga had a three-hour meeting with Defence Secretary Donald Rumsfeld.

"We have come to an understanding that we both feel is in the best interests of our two countries," Mr Rumsfeld said.

Further talks

Tokyo and Washington agreed last year the broad framework of a plan to reduce the number of troops on Okinawa, where most of the American forces are based.

About half of all US troops in Japan are based on Okinawa

It included the proposal to redeploy the 8,000 marines to Guam but the Japanese government felt its contribution to the moving costs should be smaller.

After several rounds of negotiations over the last few weeks, Japan's Defence Agency agreed to pay 59% of the costs in grants, loans and investments.

Japanese Chief Cabinet Secretary Shinzo Abe said Japan's contribution was needed to accelerate the transfer.

"Japan needs to shoulder the necessary costs in order to achieve as early as possible our two goals of reducing the local burden and maintaining the deterrent capability," he told reporters in Tokyo.