Yet vaccinated people should still wear masks in public settings indoors and outdoors where there is a substantial risk of Covid-19 transmission, such as concerts, sporting events and other crowded gatherings, the CDC said.

The fully vaccinated should wear masks at indoor gatherings with unvaccinated people, visits to a barber, hair salon, shopping mall, museum, movie theater or crowded house of worship. Vaccinated people should also wear masks if singing in an indoor chorus, the CDC said.

The new guidelines are the latest easing restrictions for vaccinated people. They follow mounting scientific evidence indicating the risk of infection is low outdoors, especially among people who are vaccinated. The risk of Covid-19 transmission by vaccinated people is low, evidence shows.

Federal health officials said they hope the revisions will help persuade millions of people who are reluctant or otherwise haven’t been inoculated to get the shot amid a recent decline in demand.

Speaking from the White House, President Biden said the nation had made “stunning progress” in the fight against Covid-19. But he appealed to those who hadn’t yet been vaccinated by framing the relaxed guidelines as incentive to do so.

“For those who haven’t gotten their vaccination yet, especially if you’re younger or think you don’t need it, this is another great reason to go get vaccinated. Now. Now,” Mr. Biden said. “Yes, the vaccines are about saving your life. But also the lives of the people around you. But they’re also about helping us get back to closer to normal.”

“So go get the shot. It’s never been easier,” he added. “And once you’re fully vaccinated, you can go without a mask when you’re outside and away from big crowds.”

CDC Director

Rochelle Walensky

said increasing evidence that most Covid-19 transmission occurs indoors, rising vaccination rates and falling rates of new Covid-19 cases motivated the agency to revise its guidance and that it will make further changes as case rates continue to come down.

Fully vaccinated people should still wear masks at crowded outdoor venues like stadiums because distinguishing between vaccinated and unvaccinated people among so many people isn’t possible. “When you have that density, we really do worry about protecting the unvaccinated people,” she said.

They should also wear masks indoors to protect themselves and others while the virus continues to spread widely, Dr. Walensky said. “Although these vaccines are extremely effective, we know that the virus spreads very well indoors,” she said.

Dr. Walensky said the improving case and vaccination trends have given her more hope, a few weeks after she expressed a sense of “impending doom” about rising cases and hospitalizations. If the number of people vaccinated continues to rise and cases fall, “we should be in good shape,” she said.

Paul Sax, clinical director of the infectious diseases division at Brigham & Women’s Hospital in Boston, said he applauded the changes because they were based on the science of Covid-19 transmission. “It will motivate people to get vaccinated,” he said. “They’re using a carrot rather than a stick.”

Linsey Marr,a professor of civil and environmental engineering at Virginia Tech and an expert on airborne transmission, called the new guidance “welcome, but confusing because it lists too many different stipulations and it’s hard to keep track of all of them.”

She said she sticks with her “2-out-of-3 rule” involving outdoors, masks and distance. “This means that if you are outdoors—you have checked off one item—you should then either maintain distance from others or you should wear a mask,” she said. “If you are indoors with others, then you should mask and distance.”

The CDC, the federal government’s public-health agency, sets the voluntary guidelines to steer local leaders. The agency has been issuing and reworking its recommendations throughout the pandemic, as its dynamics have changed and researchers developed better understanding of the virus.

Many public-health authorities have for months encouraged masking as a key tool for reducing the risk of infection and transmission, though it has emerged as a political issue in some states.

The CDC didn’t previously recommend masks be worn outdoors for all activities. The agency had said on its website that “masks may not be necessary when you are outside by yourself away from others, or with people who live in your household.” Some places, however, require people to wear masks when out in public.

Existing CDC guidance said that fully vaccinated people could gather privately in small groups without masks or physical distancing, and travel without putting themselves at serious risk or needing to quarantine as long as they wear masks and take other precautions.

With the new guidelines, federal officials are trying to help vaccinated people resume some aspects of a normal life while preventing further transmission of Covid-19.

Vaccination appears to help slow spread of the virus, health experts said. To relax pandemic restrictions, health authorities have been racing to inoculate more people as a more transmissible variant has taken hold in parts of the U.S.

More than a year of research and outbreak investigations have shown that the risk of catching the virus drops considerably outdoors. The research indicates the risk is higher indoors, where the tiny air particles carrying the virus are more likely to linger and circulate, especially in crowded places with poor ventilation.

“The data are overwhelming that the real risk is indoors,” said John Brooks, chief medical officer for the CDC’s Covid-19 response.

Transmission outdoors isn’t impossible, according to researchers, especially in more crowded conditions, or where people may be breathing heavily, shouting or even just talking while in proximity to others for extended periods.

In a systematic review of outdoor transmission published in November in the Journal of Infectious Diseases, researchers concluded that five Covid-19 studies found that less than 10% of reported transmission occurred in outdoor settings. The studies also showed that the odds of transmission or super-spreading are much lower outdoors.

A study in Milan and Bergamo, Italy, published in February in the Journal Environmental Research, found very low concentrations of virus in uncrowded outdoor spaces. The findings suggested it would take dozens of days of outdoor exposure for a person to be infected in a city with a large outbreak.

“We have unlimited dilution and unlimited ventilation” outdoors, said Joseph Allen, director of the Healthy Buildings Program and an associate professor at the Harvard T.H. Chan School of Public Health. “We know that the biggest single risk factor for this virus is time indoors.”

Upon taking office in January, Mr. Biden had asked the American public to wear a mask for the first 100 days of his presidency. He also signed an executive order requiring that masks be worn on federal property and in airports and certain public transportation.

Mr. Biden’s administration has focused in recent months on accelerating the pace of vaccinations, declaring a “wartime” effort against a pandemic that has claimed more than 572,000 lives and infected more than 32 million in the U.S.

The administration has set up federally supported mass vaccination sites across the country, expanded a federal partnership with retail pharmacies and moved up a deadline to make the vaccine available to all eligible Americans by April 15.

The average number of doses administered each day rose steadily and peaked at 3.38 million this month, but it has dropped more recently amid waning demand. The CDC says more than half of Americans have received at least a first dose of the vaccine.

Still, Mr. Biden has urged Americans to remain vigilant amid concerns over variants rapidly spreading across the country. He has called on people to wear a mask in public and voiced disapproval of states that have relaxed mask mandates.

Corrections & Amplifications
Health and Human Services Secretary

Xavier Becerra

said: “The message is clear: ‘You’re vaccinated, guess what? You get to return to a more normal lifestyle. If you’re not vaccinated … you’re still in danger.” An earlier version of this article, which no longer cites him, incorrectly omitted the ellipsis from his quote. (Corrected on April 27)

Write to Betsy McKay at betsy.mckay+1@wsj.com, Sabrina Siddiqui at Sabrina.Siddiqui@wsj.com and Caitlin McCabe at caitlin.mccabe@wsj.com