The company says the chicken change will take place within the next two years. It says suppliers will still be able to use a type of antibiotic called ionophores that keep chickens healthy and aren't used in humans. The milk change will take place later this year.
Many cattle, hog and poultry producers give their livestock antibiotics to make them grow faster and ensure they are healthy. The practice has become a public health issue, with officials saying it can lead to germs becoming resistant to drugs so that they're no longer effective in treating a particular illness in humans.
Chipotle and Panera already say they serve chicken raised without antibiotics, but the announcement by McDonald's is notable because of its size; the company has more than 14,000 U.S. locations. Chipotle has nearly 1,800 locations, while Panera has almost 1,900 locations.
"This really does move the ball quite a bit," said Gail Hansen, a senior officer with the antibiotic resistance project with The Pew Charitable Trusts. Hansen noted that ionophores, the antibiotics that will be allowed by McDonald's, are not considered medically important for humans.
Marion Gross, senior vice president of McDonald's North America's supply chain, said the change will cost the company more but noted the increase won't necessarily be passed on to customers because several factors are used to determine restaurant prices.
"I think you will hear more from us as it relates to our food," Gross added.
The announcement comes as McDonald's Corp. struggles to transform its image amid intensifying competition from smaller rivals positioning themselves as more wholesome alternatives.
The company has long battled negative perceptions about its food, but that has become a bigger vulnerability as more people shift toward options they feel are made with ingredients that are higher quality or meet standards on social responsibility.
After seeing customer visits to U.S. stores decline two years in a row, McDonald's had recently hinted changes could be on the way. Franchisees were told of the upcoming chicken and milk announcement Tuesday night at a "Turnaround Summit" in Las Vegas.
Scott Taylor, a McDonald's franchisee who was at the conference, said ingredients are "becoming more and more important" to customers. And he said the company was suggesting it needs to "be where our consumers want and need us to be."
"You're going to see more stuff like that in the future," Taylor said.
In a statement, chicken supplier Tyson Inc. said it looks forward to working with McDonald's to meet its new standards. Tyson noted it has reduced the use of antibiotics effective in humans by more than 84 percent since 2011.
Caroline Smith DeWaal, food safety director at the Center for Science in the Public Interest, said selling milk produced without rBST was a good step because the artificial growth hormone can cause health problems in dairy cows.
As McDonald's fights to hold onto customers, the company has also made a number of leadership changes, admissions of shortcomings and declarations that changes are in the works.
The pressures reached the top of the company in late January, when the company said CEO Don Thompson would be replaced by Steve Easterbrook, its chief brand officer.
The CEO change officially took effect this week, and Easterbrook was at the franchisee summit in Las Vegas.