President Obama told top leaders in Congress on Thursday that he will end combat operations in Iraq on Aug. 31, 2010, putting a halt to all U.S.-led counterinsurgency efforts and transitioning the mission in Iraq to training, advising and engaging in limited counter-terrorist operations, congressional sources tell FOX News.

The president is expected to deliver a speech Friday at the Marine base in Camp Lejeune, N.C, in which he will order an immediate drawdown of the 142,000 Marines and Army personnel in Iraq. 

Obama set a goal of reducing the U.S. military footprint in Iraq to no fewer than 35,000 and no more than 50,000 personnel after that date, congressional leaders were told.

Obama's decision to end all counter-insurgency missions in Iraq reflects his belief that "there have been real advances" in the country and, as a result, the U.S. military should now be ordered to carry out "a fundamental change in mission," senior administration officials said.

"This is a plan that responsibly ends the war in Iraq," said a senior official who participated in the deliberations. "He is living up to a commitment he made as a candidate but is doing so in a way that has the support of the inter-agency task force on Iraq."

The president will order U.S. military commanders to leave a residual force of between 35,000 and 50,000 troops in Iraq. Under the Status of Forces Agreement with the Iraqi government, the U.S. must remove all military personnel by Dec. 31, 2011.

The move reflects the consensus plan presented to Obama by Defense Secretary Robert Gates, Army Gen. Ray Odierno, the top military commander in Iraq, Army Gen. David Petraeus, head of U.S. Central Command, the Chairman of the Joint Chiefs of Staff, Adm. Mike Mullen, and the president's top intelligence officials.

Leaders of both parties raised concerns about Obama's intention to maintain the large number of troops in Iraq after combat operations cease.

"I have been one who has called for significant cutbacks in Iraq for some time. And I am happy to listen to the secretary of defense, the president, but when they talk about 50,000, that's a little higher number than I had anticipated," Senate Majority Leader Harry Reid, D-Nev., told reporters before heading into the meeting with the president.

"This is not a political calculation," a senior official said. "This is a plan the president believes will advance U.S. national security interests. This is not a plan that just hopes we can get to a spot. This really represents a meeting of the minds. This is really a big project for an entirely different mission."

The president reached his decision on Wednesday after 12 advisory group meetings on Iraq and 10 inter-agency meetings since Inauguration Day. The first Iraq advisory meeting occurred at the White House Jan. 21.

President Obama intends to convey his decision about U.S. troop withdrawals by telephone to Iraqi Prime Minister Nouri Al-Maliki on Friday. Scheduling conflicts prevented the two leaders from speaking by phone on Thursday, officials said. The president and his advisers have kept the Iraqi civilian leadership informed about internal U.S. deliberations on troop withdrawals, administration officials said.

Obama told lawmakers on Thursday the troops remaining in Iraq after Aug. 31, 2010 will carry out new missions and will be trained and organized in a way that de-emphasizes combat-readiness and intensifies the focus on these three missions:

* Train, equip and advise Iraqi security forces.

* Support civilian operations in Iraq aimed at reconstruction, redevelopment and political reconciliation.

* Conduct targeted counter-terrorism missions.

To underscore the president's desire to end combat and counter-insurgency missions, officials said after Aug. 31, 2010, there will be no brigade combat teams or BCTs in Iraq. There are 14 brigade combat teams in Iraq now. 

The remaining troops will be "reconstituted," officials said, into "advisory and assistance brigades."

Even so, if security conditions in Iraq deteriorate in the coming months the president "retains the flexibility" to slow down or reverse troop withdrawals. Officials said Obama's drawn-down is unlikely to jeopadize security gains achieved as a result of the Bush adminstration surge that has seen a significant reduction in terrorist-inspired and insurgent-led violence in Iraq.

A portion of the 35,000 to 50,000 remaining troops will be combat-ready and will be ready to deploy in counter-terrorism missions. That means combat operations are still possible, even after Aug. 31, 2010, an official said. Senior officials would not say how large the counter-terrorism force will be, but said it would be well under half the remaining troop strength.

"There will be a capability left to engage in targeted counter-terrorism operations," the official said, calling the this capability "a prudent part of the puzzle."

Overall, the size of the remaining U.S. force was "driven by the mission," officials said. U.S. troops will begin leaving Iraq this spring and the numbers of returning troops will grow during the summer, officials said. A sizable number of troops will remain in Iraq, however, to provide security and training as the country prepares for regional and sub-regional elections this spring and national elections in December.

FOX News' Trish Turner contributed to this report.