President Barack Obama first nominated Fanning in September. He has served in senior positions in the Defense Department, including acting undersecretary of the Army, special assistant to Defense Secretary Ashton Carter and undersecretary of the Air Force.
In early November, Sen. Pat Roberts (R-Kan.) placed a hold on Fanning's nomination over an unrelated issue: opposition to Obama's push to close the U.S. prison at Guantanamo Bay, Cuba.
The Pentagon announced Monday that Fanning will temporarily take a staff position in the secretary's office until the Senate confirms him. Some senators were concerned that Fanning would be violating federal law if he continued to serve as acting Army secretary while his confirmation was pending.
"You don't put people in jobs until they are confirmed by the Senate. That’s pretty straightforward," Sen. John McCain (R-Ariz.) said Monday, according to DefenseNews.
In addition to filling the role of acting secretary, Fanning had been serving since June as acting undersecretary, the Army's second-highest post. But last week, the Senate confirmed former Rep. Patrick Murphy (D-Pa.) as undersecretary. Murphy will now temporarily fill both roles.
A White House spokesman did not respond to a request for comment on what specifically spurred Fanning to relinquish his title of acting secretary. The Pentagon said Fanning was stepping aside as "a show of comity" to the Senate.
"We expect this move to be of a short duration and for Fanning to achieve speedy confirmation," Pentagon spokesman Peter Cook told the AP. "He remains one of the most qualified nominees to be a service secretary, having served in many senior executive positions in each of the three military departments and as chief of staff of the department."
McCain chairs the Senate Armed Services Committee, which needs to approve Fanning before he can head to the floor for a full vote. So far, no date has been set for a hearing in the committee.
The lesbian, gay, bisexual and transgender rights community applauded Fanning's nomination in September as the latest step by the administration to open up the military.
“Considering the tremendous struggles that LGBT Americans have faced within the Department of Defense, Fanning’s nomination is deeply significant," Chad Griffin, president of the Human Rights Campaign, said at the time. "This is a sign of hope and a demonstration of continued progress towards fairness and equality in our nation’s armed forces."
This piece has been updated with comments from McCain.