The US will leave areas dominated by Islamist factions and focus recovery efforts on areas where US-led forces have retaken territory from Islamic State in the northeast.
Tens of millions of dollars will be cut from previous US-backed efforts in the northwest.
These include projects for “countering violent extremism, supporting independent society and independent media, strengthening education, and advocating for community policing”, US officials said.
A State Department official added: “US assistance for programs in northwest Syria are being freed up to provide potential increased support for priorities in northeast Syria.”
A second official said the administration believed it wanted to move the assistance to areas where the US had more control.
They added that humanitarian assistance would not be affected in the northwest around Idlib province, which is the largest chunk of Syrian territory held by insurgent factions, including al Qaeda’s former affiliate in the Syrian war.
Trump said in March that it was time for the United States to leave Syria, following allied victories against Islamic State militants.
Around 2,000 US troops are deployed in Syria.
In March, Trump froze more than $200 million (£148 million) in funds for recovery efforts in Syria while his administration reassesses Washington’s role in the Syrian conflict.
But in April Trump deepened US involvement by ordering missile strikes against Syria in response to an alleged poison gas attack which killed dozens of people.
A third US official said the cuts in the northwest would take place over a period of months.
Adding: “The danger is a repeat of what the president criticised about Iraq – leaving a vacuum where the violence can get worse and extremists can exploit that.”
The Pentagon has estimated that Islamic State has lost about 98 per cent of the territory it held in Iraq and Syria.
US military officials have warned that the militants could regain the freed areas quickly unless they are stabilised.
Army Colonel Ryan Dillon warned of an apparent surge in terrorist attacks.
He said: “We have seen also not just reports, but also corroborated through our own intelligence gathering, that ISIS is starting to conduct more attacks on the west side of the Euphrates River outside of Abu Kamal against pro-regime forces.
“And then we’ve also seen – not corroborated by us, but in open source, the retaking of neighbourhoods in southern Damascus.”
He said intelligence had begun to notice the rise in ISIS attacks as early as January 2018 after the Turkish intervention in northwestern Syria as part of their “Operation Olive Branch” to remove the US-backed, Kurdish YPG.