TLDR
- OpenAI signed a deal with Amazon Web Services (AWS) on Friday to sell AI to U.S. government workers
- The deal covers both classified and unclassified government work
- AWS will sell OpenAI’s products to federal customers, with OpenAI taking a revenue cut
- The deal supports OpenAI’s Pentagon contract won after the DoD dropped Anthropic
- OpenAI CEO Sam Altman previously amended the Pentagon contract to add safety language
OpenAI has signed a new deal with Amazon Web Services to sell its artificial intelligence tools to U.S. federal government employees. The agreement covers both classified and unclassified work.
JUST IN:
OpenAI signs deal with Amazon $AMZN's AWS in bid to win US government contracts. pic.twitter.com/qVyDvBsNGp
— LuxAlgo (@LuxAlgo) March 17, 2026
The deal was signed on Friday, according to two people with direct knowledge of the agreement, as reported by The Information.
Under the terms, Amazon’s sales team will sell OpenAI’s products and services to potential government customers. OpenAI will receive a cut of the revenue earned through those sales.
AWS already serves as a major cloud provider for many U.S. government agencies, making it a natural partner for OpenAI to reach federal buyers.
The deal also supports a separate Pentagon contract that OpenAI won in late February. That contract came after the Department of Defense ended its relationship with Anthropic.
The Pentagon contract is believed to be worth millions of dollars. It marks a push by OpenAI to grow its presence in the federal government market.
OpenAI CEO Sam Altman previously said the Pentagon deal had been rushed. He said the company “shouldn’t have rushed” it following the fallout with Anthropic.
Safety Language Added to Pentagon Deal
Altman later amended the Pentagon contract to include new language. One addition states that “the AI system shall not be intentionally used for domestic surveillance of U.S. persons and nationals.”
Altman also said the Defense Department confirmed that OpenAI’s tools would not be used by intelligence agencies such as the NSA.
“There are many things the technology just isn’t ready for, and many areas we don’t yet understand the tradeoffs required for safety,” Altman said.
He also acknowledged the rollout appeared messy. “We were genuinely trying to de-escalate things and avoid a much worse outcome, but I think it just looked opportunistic and sloppy,” he said.
The Wider Government AI Race
Anthropic signed a $200 million contract with the U.S. Department of Defense in July 2025. It became the first AI company to deploy its models in mission workflows on classified networks.
OpenAI, Google, and xAI also received DoD contract awards worth up to $200 million each last year.
Amazon and OpenAI did not immediately respond to requests for comment from Seeking Alpha.
The AWS deal positions OpenAI to reach a broader set of federal customers beyond the Pentagon. AWS’s existing government relationships give OpenAI access to agencies it may not have reached on its own.
The Information first reported the AWS deal on Monday, March 17.
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