Robert Gates, the US defence secretary, has said his country would "ultimately" be prepared to surrender to the Taliban to end the conflict in Afghanistan.
Gates on Thursday, however, ruled out any possible talks between the US and al-Qaeda fighters in the country.
And, speaking after the first day of Nato meetings in Budapest about the war in Afghanistan, Gates said any surrender to the Taliban would be on the Afghan government's terms and would require the Taliban to subject itself to Kabul's rule and take over the country.
"There has to be ultimately, and I'll underscore ultimately, surrender as part of a political outcome to this," he said.
"That's ultimately the exit strategy for all of us."
Gates's comments come as a draft US intelligence report on Thursday said the situation in Afghanistan is now at its worst since the US-led invasion.
The almost completed National Intelligence Estimate said the country is in danger of a "downward spiral" into violence and chaos.
Brigadier Mark Carleton-Smith, the top British military commander in Afghanistan, said on Sunday that the war there cannot be won militarily and that talks with and surrender to the Taliban are the next steps.
Several Nato commanders and diplomats have argued that negotiations with the Taliban are necessary.
Hamid Karzai, Afghanistan's president, said last week that he had asked Saudi Arabia to mediate negotiations with the Taliban and called on Mullah Omar, the group's leader, to make peace.