The Northern Territory facility that gained national prominence as the "gold standard" for quarantine during the COVID-19 pandemic will be used to house thousands of troops form both Australia and overseas under a new lease agreement struck by the federal and NT governments.

The 3,500 bed former COVID-19 quarantine facility will be used to house thousands of military personnel from Australia and overseas under a new five-year deal between the federal and NT governments.

The first large cohort to be housed at the facility — 1,300 troops from Australia and international partner nations taking part in Exercise Talisman Sabre — is due to arrive later this month.

"The importance of this facility is it will take pressure of the local accommodation market during a crucial time for the NT tourism season, and that will ensure that there's more beds for tourists to come to."