With a month to go before the presidential election, he issued a decree that, from 2000, the army will only recruit volunteers on contract - a move that is certain to be applauded by many Russians.
He also declared that, from now on, no more conscripts will be send to "conflict zones" - in order words, Chechnya - without "their own consent on a contract basis", an apparent attempt to end the deep unhappiness over the thousands of young Russians dispatched to the Caucasus against their will, only to return in bodybags.
The promises came on a day in which Mr Yeltsin, who faces a strong challenge from the Communist Gennady Zyuga-nov, stepped up the pace of his campaign in an attempt to curry favour among a sceptical electorate. He also ordered the scaling down of capital punishment, bringing Russia closer to conforming with a key requirement of the Council of Europe, which admitted it as a member in January, despite Mr Yeltsin's dismal human rights record.
Universal conscription was introduced in 1874 as part of a series of military reforms introduced under Tsar Alexander II following the Crimean War. After the rise of Communism and the creation of the Soviet Union, it became one of the instruments by which the party administered its control over the masses. It also allowed the Soviet Union to secure its control over Eastern Europe and reinforce its superpower status.
However, the system has been on the brink of collapse since the end of the Cold War. Conscripts in the tough guerrilla war conditions of Chechnya and Afghanistan often proved useless, forcing the military to deploy its special forces. Draft-dodging has been rampant.
Mr Yeltsin's decree is also said to cover "other troops" - a reference to the interior ministry forces, border guards, fire brigades and others who use conscripts.
Although the move makes military sense, allowing the army to reduce its numbers from some 1.5 million, including 400,000 conscripts, to about 1 million, it clearly has as much to do with politics. Mr Yeltsin is running neck-and-neck with Mr Zyuganov, and he remains unpopular across much of rural Russia. Yesterday, he appeared to have scored a publicity coup; the end of conscription led the state-run ORT evening news bulletin. It is unlikely, though, that he will have pleased his hard-line generals.
Whether reducing the use of capital punishment will win any votes is also doubtful. Crime is rampant, and there is little evidence of popular support for scrapping the death penalty.
As Russia digests these fundamental changes, Mr Yeltsin has other problems to worry about. He knows the presence on the electoral ballot of three other well-known reform-leaning candidates - Grigory Yavlinksy, Svyataslav Fyodorov, and General Alexander Lebed - threatens to steal votes.
This week, albeit cautiously, he said he would be willing to consider a "government of national trust" - suggesting that he might try and form an anti-Communist alliance. Speculation grew last night after he held a meeting with Mr Yavlinsky.Reuse content