Afghan President Hamid Karzai means to scrap private security firms and could replace them with local security forces, his office says.
Private contractors, who work mainly for Western companies and are not accountable locally, have long been an irritant to the Afghan government.
They employ some 40,000 people, competing for contracts worth billions.
The government has tried unsuccessfully to register them and find out details of their weaponry and their earnings.
Among those who use private security contractors in Afghanistan is the US government.
"Dissolving the private security companies is a serious programme that the government of Afghanistan will execute," Waheed Omer, a spokesman for President Karzai, told reporters.
"Very soon the president of Afghanistan will set a deadline."
Mr Karzai has discussed the issue with commanders of the Nato-led International Security Assistance Force (Isaf), his spokesman added.
A plan was also being developed for Afghan security forces to absorb the work done by them, Mr Omer was quoted as saying by Reuters news agency.
Mr Karzai talked about scrapping security contractors in a speech to the Civil Services Institute in Kabul on Saturday.
The government "could no longer tolerate the existence of such parallel structures... whether they are owned by foreigners or Afghans", he was quoted as saying by the pro-government Afghan newspaper Weesa.
"People do not trust these companies and believe their existence is against Afghanistan's national interests."
Instead of supporting private contractors, he argued, the international community "should assist in strengthening the Afghan army and police".
But it is unclear how far companies would be prepared to entrust their security to Afghanistan's government forces, with their poor record of reliability.
In June, US auditors reported that only 23% of Afghan soldiers and 12% of police could work unsupervised.
They also found widespread absenteeism, corruption, drug abuse and illiteracy among Afghan forces.
Below is a selection of comments sent to the BBC:
There are a lot of things wrong with Karzai, but he's very right on this count. Private contractors are abominations. Conor Tucker, Albuquerque, New Mexico, USA
I was one of the first contractors to go into Afghanistan back in 02/03. We utilized a local well trusted war lord who provided us with his men for protection and transportation. We lived out of his many houses in Kabul and often moved from one place to the next. I would like to see private security remain in Afghanistan but in a role similar to the forces where they take a back seat and provide expertise and maybe some training but only when required. Rob Burton, USA
The more that Afghani's see their fellow Afghani's in security, the more they'll earn the trust of the people so that the troops and security personnel can finally come back home from this illicit war. Anon, USA
Private security firms aren't needed, when we have available, trained, armed, capable and accountable military personnel in Afghanistan. Why does the US waste money, paying mercenaries? Katerina Andreou, Daly City, California, USA
This is a knee-jerk decision. Our experience would suggest that without the oversight of well-trained professionals from the "good" companies, safety and security will quickly decline and the companies who employ these organisations will begin to scale back or close operations. Many of the good companies employ a significant percentage of armed Afghan guards and have engaged in extensive training and capacity development with these Afghans. Jay Fredericks, Kabul, Afghanistan