Turkey has chosen Chinese defence firm CPMIEC to co-produce a $4 bn long-range air and missile defense system, rejecting rival bids from Russian, US and European firms.
The Turkish defence minister announced the decision in a statement on Thursday.
Turkey, which is a member of the NATO military alliance, has no long-range missile defense system of its own, but NATO has deployed the US-built Patriot air and missile defense system there since 2012.
The winning Chinese FD-2000 system beat out the US Patriot, Russian S-400, and French-Italian Eurosam Samp-T to win the contract.
Turkey has "decided to begin talks with the CPMIEC company of the People's Republic of China for the joint production of the systems and its missiles in Turkey," said an official statement.
Raytheon Co, which builds the Patriot missile system, said it had been informed about the Turkish decision and hoped to get a briefing soon. It said there were 200 Patriot units deployed in 12 countries, including Turkey.
"NATO has long supported the system, deploying Patriot in five aligned countries and, in 2012, providing a requested Patriot deployment to Turkey. Given this strong performance, we hope to have an opportunity to debrief and learn more about this decision," Raytheon spokesman Mike Doble said.
Defense Minister Ismet Yilmaz's statement also said a contract to produce six corvette ships by Koc Holding, Turkey's biggest conglomerate, had been cancelled.
A contract to build two ships would be awarded to the Turkish naval shipyard. The construction of four remaining ships will be put out to tender later, Yilmaz said.
Koc Holding was recently accused of backing the 1997 military overthrow of Turkey's first Islamist-led government, sending the firm's shares tumbling on fears of a deepening vendetta against the country's secular business elite.
The Turkish government launched a probe into the taxes of Koc energy firms in July, weeks after criticising one of the family's hotels for sheltering protesters during anti-government unrest that rocked several cities over the summer.