The largest share of the money - nearly $800 million - will be used to upgrade train speeds from 135 mph to 160 mph on critical segments of the heavily traveled Northeast corridor, the department said in a statement.
In the southeast, $4 million will go for environmental analysis on the Richmond to Raleigh section of the Southeast High Speed Rail Corridor (SEHSR). The goal is to eventually link Charlotte and Richmond with 110-mph capable service.
Another $404 million will go to expand high-speed rail service in the Midwest, including newly constructed segments of 110-mph track between Detroit and Chicago that are expected to save passengers 30 minutes in travel time.
Nearly $340 million will go toward state-of-the-art locomotives and rail cars for California and the Midwest. California will also get another $300 million toward trains that will travel up to 220 mph between San Francisco and Los Angeles.
"These projects will put thousands of Americans to work, save hundreds of thousands of hours for American travelers every year, and boost U.S. manufacturing by investing hundreds of millions of dollars in next-generation, American-made locomotives and rail cars," Vice President Joseph Biden said in a statement.
President Barack Obama has sought to make creation a national network of high-speed trains a signature project of his administration. He has said he wants to make fast trains accessible to 80 percent of Americans within 25 years.
The money -- initially $2.4 billion -- had been awarded to Florida for high-speed trains between Tampa and Orlando. After Gov. Rick Scott canceled the project, the Transportation Department invited other states to bid for the funds. It received 90 applications seeking a total of $10 billion.
Scott said he was concerned that the state government would be locked into years of operating subsidies. However, a report by the state's transportation department forecast the rail line would be profitable. The project initially had been approved by Scott's predecessor, Republican-turned-Independent Charlie Crist.
Two other Republican governors elected in November have canceled high-speed train projects in their states. Wisconsin Gov. Scott Walker turned down $810 million to build a Madison-to-Milwaukee high-speed line. Ohio Gov. John Kasich rejected $400 million for a project to connect Cincinnati, Cleveland and Columbus with slower-moving trains. Both the Ohio and Wisconsin projects had been approved by the governors' Democratic predecessors.
Republican members of Congress have also opposed funds for high-speed trains, rescinding $400 million of the money previously awarded Florida as well as other unspent money designated for trains in budget deliberations with the administration.