Vaccinated people will be required to wear masks in some settings, such as planes, trains and buses and inside airports, bus and train stations.
Several major chains, including CVS, Home Depot, Macy's and supermarket giant Kroger Co, said they are still requiring masks in stores for the time being, though some said they are reviewing their policies.
"It's important to note that all guests two years of age and older who are not fully vaccinated must wear face coverings during their visit, except while eating or drinking", the statement said.
The agency also said fully vaccinated people don't have to wear masks outdoors, even in crowded spaces.
"The experience in other states has been that some individuals may choose to wear masks, and many businesses, schools, hospitals, and other employers may choose to require masks in their buildings", the governor said in a statement. "That will remain their choice".
The US Centers for Disease Control and Prevention (CDC) has relaxed its rules for mask-wearing as long as you've had a COVID-19 vaccine. The state hasn't established new guidelines for businesses, but its top epidemiologist said businesses would likely need to check COVID-19 vaccine cards to verify vaccination status for customers.
But the announcement represents a quantum shift in recommendations and a major loosening of the mask restrictions that Americans have had to live with since COVID-19 became a major part of USA life 15 months ago.
Immunocompromised individuals should consult a physician before giving up masks, Walensky said Thursday, warning that if the country's case counts go back up the guidance could change.
"While we all share the desire to return to a mask-free normal, [the CDC] guidance is confusing and fails to consider how it will impact essential workers who face frequent exposure to individuals who are not vaccinated and refuse to wear masks", Marc Perrone, the UFCW's global president, said in a statement.
The average number of new COVID-19 cases nationwide, over a weekly period, has fallen to 36,800 a day - a 23 per cent drop when compared to the previous seven-day period, and a 50 per cent decrease from the peak of the springtime wave recorded a month ago.
"I think it just further supports the decision we made to lift the mask mandate", said newly elected Mayor Larry Milton. Many had already been ditching mask orders in recent weeks.
The CDC and the Biden administration have faced pressure to ease restrictions on fully vaccinated people - those who are two weeks past their last required dose - in part to highlight the benefits of the shots and motivate other people to get inoculated.