US-led troops have undercut the Taliban but the Afghan government's performance remains a cause for concern, US Defense Secretary Leon Panetta said in an interview.
"We have, in fact, seriously weakened the Taliban," said Panetta, according to a transcript of his interview Tuesday on the "Charlie Rose Show" on PBS.
"We expected a greater offensive this year than took place," he added.
"The reason it didn't take place is because of our operations. Because of the increased security, we have reduced the influence of the Taliban."
Afghan security forces also have expanded and are increasingly fighting alongside NATO-led troops, he said.
"We're on target. And they are doing the job," he said, adding that he was "feeling much better" about turning over greater security responsibility to local forces.
But he said the performance of the Afghan government was "a larger question mark."
He expressed concern about "the ability of Afghanistan to be able to exert the kind of governing that they have to do in order to provide stability for the future."
But he added that President Hamid Karzai was "trying" to address pervasive corruption and other challenges facing his government.
Relations have been strained between Karzai and the US administration, with the Afghan president sometimes lashing out publicly against Washington.
August was the deadliest month of the war for US forces, with at least 69 troops killed.
About 100,000 troops are deployed in Afghanistan, with 33,000 forces due to leave by mid-2012.
This year is on track to be the bloodiest yet for civilians, with casualties up 15 percent in the first six months, according to UN figures.
Eighty percent of the deaths are blamed on insurgents.