The British Army recruited 11,460 new soldiers in the past year, a rise of 9%, but it has still fallen short of its targets by 1,000.
More soldiers are being recruited - but still not quite enough
During the 2005/2006 financial year, recruiting rose by 9.2% - 1,060 more soldiers than the previous year.
Army recruiters have attributed the rise to high-profile TV advertising, including a drive for the infantry.
But the Tories said 14,000 people had left the army in the past year, meaning it had actually shrunk by 1,500.
It comes as the army deals with major deployments to Iraq and Afghanistan.
Units such as the Royal Engineers, Royal Armoured Corps, Royal Signals and Royal Electrical and Mechanical Engineers have exceeded their annual recruitment targets, BBC defence correspondent Rob Watson said.
Defence Minister Adam Ingram is marking the increase during a visit to the Army Foundation College in Harrogate, North Yorkshire.
"I'm pleased to say that this year we have seen a significant increase in those expressing an interest in joining the Army; where you have led, others follow," Mr Ingram will tell soldiers graduating training during his visit.
"Public support for our forces is vitally important. It is justifiably very high. Eighty per cent of the British public thinks our army is among the best in the world.
"As you leave this fine establishment, each of you has a role to play in helping the public to understand what you do and why you do it."
The armed forces remain under-manned, with part of the problem being blamed on the war in Iraq and low unemployment, our correspondent said.
As well as their deployments in Iraq and Afghanistan, British troops are sent to Kosovo, Bosnia and Northern Ireland as well as non-operational deployments in areas such as Germany, the Falkland Islands and Cyprus.
Conservative Shadow Defence Minister Mark Harper said: "It's welcome news that recruitment last year has risen from the very low base the year before - it is now only the second-worst year for recruitment in the last five.
"However, retention is still poor with over 14,000 leaving the army in the past year, outstripping the recruitment leaving, the army 1,500 soldiers smaller.
"With ever increasing commitments and a shrinking army, the effects of overstretch are just going to get worse."
Nick Harvey, for the Liberal Democrats, said "the painful reality" was that there were fewer army personnel than at any time since the conflict in Iraq in 2003.
"The government needs to explain how the army is to cope with the challenges in Iraq and Afghanistan with its forces so overstretched.
"Shortfalls in forces' medical staff also pose grave problems which must be urgently addressed if we are to send out servicemen and women into increasingly dangerous situations," he added.