US President Donald Trump on Friday directed all federal agencies to immediately cease using technology developed by Anthropic after the AI firm refused a Pentagon demand for unconditional military use of its Claude models.

In a post on his Truth Social platform, Trump said: “I am directing EVERY Federal Agency in the United States Government to IMMEDIATELY CEASE all use of Anthropic’s technology. We don’t need it, we don’t want it, and will not do business with them again.”

He warned the company to cooperate during what he described as a phase-out period or face “major civil and criminal consequences.”

The dispute stems from the Pentagon’s demand that Anthropic permit unrestricted use of its AI systems, including potential deployment for domestic surveillance and fully autonomous weapons. The Department of Defense reportedly gave the company until 5:01 p.m. Friday to comply or risk action under the Defense Production Act, a Cold War-era law granting broad federal authority over private industry in matters of national security.

Anthropic rejected the demand and vowed to challenge any punitive measures in court. In a statement, the San Francisco-based startup said it would not allow its technology to be used for “mass domestic surveillance” or in “fully autonomous weapons systems,” arguing that such applications could undermine democratic values.

US Defense Secretary Pete Hegseth said the Pentagon would prohibit contractors that work with the US military from engaging commercially with Anthropic. He accused the company of arrogance and said the move was necessary to protect national security interests.

Top House Democrat Hakeem Jeffries criticised the administration’s approach, describing it as an invasion of privacy and praising Anthropic for resisting the demand.

The conflict has prompted reactions across the AI sector. Employees from firms including OpenAI and Google DeepMind signed an open letter urging their employers to stand together against requirements that would enable mass surveillance or autonomous lethal weapons.

OpenAI chief executive Sam Altman reportedly told staff he was seeking an agreement with the Pentagon that would include clear ethical limits, echoing the principle that humans should remain involved in high-stakes automated decisions.

Anthropic, while pledging legal resistance to any “supply chain risk” designation, said it remains willing to support US national security efforts, provided its technology is not used in ways it views as incompatible with democratic safeguards.