THAAD Missile Defense: $11.4B Request After Iran War Drain
THAAD missile defense explained: how a battery works, the Army’s $11.4 billion FY2027 request for 857 interceptors, and its use against Iran.
The Terminal High Altitude Area Defense system, known as THAAD, is the U.S. Army’s interceptor for hitting ballistic missiles high in the sky as they come down toward their targets. It saw its heaviest use yet in 2025 and 2026 against Iranian missiles. The Army’s fiscal 2027 budget now asks for more than $11.4 billion for the program, mostly to buy 830 extra interceptors. This guide to THAAD missile defense explains what the system is, what it costs, where it is deployed and how it compares with other U.S. missile defenses.
What THAAD is and what it does
THAAD is a land-based, mobile system designed to destroy short-, medium- and limited intermediate-range ballistic missiles in their final, or terminal, phase of flight, according to the Congressional Research Service (CRS). The interceptor carries no explosive warhead. It destroys its target by direct impact, an approach often called “hit-to-kill.”
CRS defines the threat bands as short-range (under 1,000 km), medium-range (1,000 to 3,000 km) and intermediate-range (3,000 to 5,000 km). Its reported intercept range is 150 to 200 km. CRS says THAAD defends a larger area than the Patriot system and complements Patriot and the Navy’s Aegis system.
The battery, by the numbers
| Component | Per battery |
|---|---|
| Soldiers | About 90 |
| Truck-mounted launchers | 6 |
| Interceptors (8 per launcher) | 48 |
| Radar | AN/TPY-2 |
| Other | Fire control and communications unit |
Peter’s World table built from CRS In Focus IF12645, updated June 23, 2026.
Lockheed Martin is the prime contractor and builds the interceptor in Troy, Alabama. Army development began in 1992. CRS records test failures between 1995 and 1999, then 14 successful intercepts in 18 planned tests between 2006 and 2019, with four tests cancelled.
Production and cost
The Army’s fiscal 2027 Missile Procurement justification book says the program moved from the Missile Defense Agency to the Army beginning in fiscal 2027. It lists five parts: interceptors, launchers, AN/TPY-2 radars, fire control, and support equipment.
| FY2027 request item | Amount |
|---|---|
| Discretionary: 27 interceptors and related costs | $907.2 million |
| Mandatory funding: 830 interceptors | $10.53 billion |
| Total THAAD request | $11.44 billion |
| Interceptor unit cost (discretionary line) | About $12 million |
Peter’s World table from the Army’s FY2027 Missile Procurement justification book (April 2026).
The same book projects about $5.8 billion to $6.1 billion a year for fiscal 2028 through 2031 and plans a multiyear contract from fiscal 2027. CRS cites an American Enterprise Institute estimate of about $2.73 billion for a full battery with 192 interceptors, plus about $32.5 million a year to operate it.
Users and deployments
The Army has eight batteries. The first was activated at Fort Bliss, Texas, in May 2008, and the eighth received its minimum engagement package in June 2025, according to CRS. Batteries have been sent to:
- Guam, since 2013.
- South Korea, at Seongju, after a decision announced July 7, 2016.
- Romania, in 2019.
- The Middle East, from October 2023.
- Israel, starting Oct. 13, 2024.
Combat record
THAAD’s combat use has come against Iran. CRS reports that during the June 2025 Israel-Iran war, one study estimated about 92 interceptors were fired from a stock of roughly 632. A separate CRS Insight says the U.S. reportedly fired about a quarter of all THAAD interceptors it had ever bought.
In Operation Epic Fury, the U.S.-Israeli campaign against Iran that began in late February 2026, CRS says THAAD reportedly achieved an intercept rate above 90%, notably in the UAE. CRS also notes allegations that some AN/TPY-2 radars were damaged or destroyed by Iranian strikes. Neither figure has been confirmed by the Pentagon. Six launchers from U.S. Forces Korea deployed to the region in March 2026 and returned in June, according to CRS.
How it compares
| System | Service | Intercept phase | FY2027 request |
|---|---|---|---|
| THAAD | Army (from MDA) | Terminal, high altitude | 857 interceptors, $11.44 billion |
| Patriot PAC-3 MSE | Army | Terminal, lower altitude | $12.23 billion, including 2,554 missiles in mandatory funding |
| Aegis SM-3 | Navy and MDA | Midcourse, from ships | Not in the Army book |
Peter’s World comparison built from the Army FY2027 Missile Procurement justification book and CRS IF12645.
Peter’s World’s view
Analysis: Peter’s World interpretation of the sources above.
The budget is a reaction to two wars in about a year. CRS figures suggest the U.S. used a large share of its stock in June 2025, and the fiscal 2027 request asks for more interceptors in a single year than that entire estimated stockpile. In our reading, the key question is production, not money. CRS cited estimates of three to eight years to replace the interceptors used in 2025. Unless the multiyear contract raises output, the funding may arrive faster than the missiles.
What to watch
- Whether Congress approves the $10.5 billion in mandatory funding for 830 interceptors.
- The size and terms of the first Army multiyear THAAD contract.
- Any Pentagon confirmation of radar losses during Epic Fury.
- Where batteries stay after the Iran war, including whether Korea’s launchers redeploy again.
Follow the war through our Iran war tracker and Iran news hub, and compare with our guide to Patriot PAC-3 MSE production and the IFPC second interceptor.
This article was written by Peter with AI assistance and checked against the sources linked. See our AI use disclosure.
Warfare explained: Ballistic missile vs cruise missile: key differences
Sources
- Congressional Research Service: THAAD In Focus (IF12645, June 2026)
- Congressional Research Service: Iran conflict Insight (IN12668)
- U.S. Army: FY2027 Missile Procurement justification book
Additional sources
- Line-item breakdown of the THAAD request. AwardTape, DoD P-1 compilation
- Missile Defense Agency photo of a THAAD launch during a 2013 test, public domain. Wikimedia Commons_interceptors_is_launched_during_a_successful_intercept_test_-_US_Army.jpg)
