In a speech to parliament in the capital Ulan Bator, Bush thanked Mongolia for its contribution of 120 soldiers to Iraq and about 50 in Afghanistan.
"I've come here to thank you for contributions to freedom's cost and to tell you the American people appreciate your courage and value your friendship," Bush said.
Bush said Mongolia has stood with the United States as "brothers in the cause of freedom" and called Mongolians' success in driving communist leaders from power 15 years ago an example for the world.
Bush's four-hour stop in Mongolia was the first ever by an American president. Mongolia was the last scheduled stop during the U.S. president's tour of Asia, which included visits to Japan, South Korea, and China.