Testifying before the Senate Foreign Relations Committee, Rice said the US objective was to "break the back" of the insurgency so the Iraqis could finish it off without large-scale US help.
But she acknowledged the insurgents may be able to carry out attacks "for quite a long time" and refused to set a timetable for withdrawing American troops from Iraq 31 months after the US-led invasion.
Rice said under repeated questioning that discussion of the pullout of some 140,000 US troops still in the war-battered country "should be results-based rather than time-based."
"In terms of results we know exactly what we want to achieve," she said. "We want Iraqi security forces that can hold their territory, where insurgents can't leave a city and then come back and terrorize the population."
"You do not want American forces to leave and then find out that Iraqi forces are incapable of holding their own territory," the chief US diplomat told the senators.
Asked by Democratic Senator Paul Sarbanes whether the troops would be out in five years, Rice said, "I don't want to speculate. I do know that we're making progress with what the Iraqis themselves are capable of doing.
"And as they are able do certain tasks, as they are able to hold their own territory, they will not need us to do that," Rice said.
Sarbanes pressed on, saying, "let me rephrase the question a little easier: what about 10 years from now?" But again, Rice would not bite.
"Even to try and speculate on how many years from now there will be a certain number of American forces is not appropriate," she said. "What is appropriate to say is the Iraqis have made progress."
Rice insisted that "we are moving on a course in which Iraqi security forces are rather rapidly able to take care of their own security concerns."
She said that 91 Iraqi regular army battalions were currently in combat, compared with five in August 2004.
But US military officials have said that only one Iraqi battalion, generally comprised of 700-1,000 men, had the capacity to operate on its own without US support.
A New York Times/CBS News poll last month showed that 52 percent of Americans wanted an immediate withdrawal of US forces from Iraq with only 42 percent feeling the troops should stay the course.
But Rice said the United States was moving towards a military, political and economic strategy to ensure a "decisive victory" over the insurgents, who were bent on sapping the will of Washington and its allies.
"Let us say it plainly: The terrorists want us to get discouraged and quit. They believe we do not have the will to see this through," she said.