The US Army has decided to extend the space and missile defence research contract, also known as COSMIC, with BAE Systems without competition.
Under the two-year $561m extended contract, the company will provide services in support of concept development and integration of electronic surveillance and reconnaissance systems.
Services under the contract will run through 30 September 2012, with one additional option year.
The US Army is also planning to award a multibillion-dollar programme, known as D3I, before the end of the year.
The Washington Post has reported that BAE, Lockheed Martin and Raytheon will be bidding for the contract.