Karzai, whose relations with the West have plummeted since he was anointed leader after US-led troops invaded Afghanistan in late 2001 and brought down the Taliban, spoke just hours after President Barack Obama's announcement.
"Today we welcome the announcement by the president of the United States," Karzai told reporters.
"We term it as a good step in their favour, and in favour of Afghanistan and we support it." Karzai also congratulated his own nation "on this step towards defending its own soil, through its own people".
Obama said 10,000 troops would leave Afghanistan by the end of the year and all 33,000 troops sent as part of a "surge" announced in late 2009 and designed to reverse the Taliban insurgency would depart by next summer.
Obama sought to convince Americans that "the tide of war is receding" and that while there were tough times ahead in Afghanistan, "the light of a secure peace can be seen in the distance."
The Taliban, the main militant group in an insurgency which has lasted nearly 10 years, dismissed Obama's comments as only "a symbolic step." Although the US supports Karzai's government, relations between the two sides are frequently thorny.
US officials are frequently exasperated by Karzai's public outbursts against them, while the Afghan leader accuses Washington of not doing enough to limit civilian casualties in the war.