The Ministry of Defence has spent more than £320,000 over the past five years on ceremonial hats for guardsmen, each made from a single bearskin.
The policy has caused an outcry among animal welfare campaigners who say using synthetic fur would be more humane and far cheaper.
The Ministry of Defence has promised to phase out ceremonial bearskin caps following complaints that killing wild bears is cruel and unnecessary.
Fur used in busby hats worn by the Royal Horse Artillery has already been replaced with synthetic fur, following protests. But animal welfare campaigners accused the Government of dragging its feet over the guardsmen's hats.
They said that synthetic alternatives presented to the Ministry of Defence had been rejected on aesthetic grounds, including that they were not lustrous enough.
Animal welfare groups have said the use of ceremonial bearskin caps, worn by Buckingham Palace Guards and during the Trooping of the Colour, fuels the hunting of wild bears in Canada and the United States. The reported cost over five years represents at least 250 dead bears.
Campaigners say the hunters have been known to kill mothers with cubs, leaving the orphans to die, and to seriously wound bears leaving them unable to hunt and condemning them to starve to death.
"Tradition is no excuse for outright cruelty," said a spokesman for Peta, the animal welfare campaign group. "Intelligent, curious black bears are often shot several times before they die. Some of these bears escape wounded and face a slow death in the woods from blood loss, gangrene, infection, dehydration or starvation."
Prince Charles and the Queen have been "tailed" by a protester in a bear suit for two years in protest at the use of wild bear pelts.
Sources close to the Ministry of Defence said that they are trying to reduce the number of pelts used and are increasingly refurbishing existing hats. But they said the military would continue buying the bearskin hats until a suitable alternative is found.