Mattis's no-nonsense message to his counterparts in Brussels follows years of calls by Washington for allies to spend at least two percent of their GDP on defence, a goal that only a handful meet despite agreeing on it at a summit in 2014.
It packs extra weight as it comes after Trump has said US help for NATO members -- already worried by the threat from Russia in the east -- might depend on how much they have paid.
"Americans cannot care more for your children's future security than you do," retired Marine general Mattis said in prepared remarks to defence ministers at NATO headquarters.
"If your nations do not want to see America moderate its commitment to this alliance, each of your capitals need to show support for our common defence."
Mattis called for "milestone dates" this year that would track NATO member contributions.
'Very firm message'
NATO Secretary General Jens Stoltenberg denied that Mattis's words amounted to a threat, saying it was a "firm message" and that his colleagues agreed that they would do more to contribute.
"Secretary Mattis conveyed a very firm message to all Allies. That message is about the importance of fair burden-sharing. It reflects a political reality in the United States," Stoltenberg told a press conference.
Currently, only the United States, Britain, Estonia, Greece and Poland have hit or surpassed the two percent figure.
The call for more funding comes as NATO mounts its biggest buildup since the Cold War, strengthening its eastern flank following Russia's annexation of Crimea in 2014.
British Defence Secretary Michael Fallon told reporters that he had called on laggards to at least increase spending annually to "demonstrate good faith."
NATO said its member countries spent a total of $892 billion (842 billion euros) in 2015, with the United States accounting for $641 billion. Russian military spending in 2015 rose to 66 billion dollars, the SIPRI institute in Stockholm said.
Despite lambasting some NATO partners' spending, Mattis hailed NATO as the "fundamental bedrock" of transatlantic security as he sought to reassure allies about Trump's commitment to the alliance.
Since his inauguration, Trump has taken a more orthodox stance on NATO and reaffirmed long-standing US commitment to the alliance that Mattis has previously served.
Trump, who is set to meet NATO leaders in Brussels in May, had previously said the alliance was "obsolete."
Russia scandal
Mattis's visit to NATO, his first trip to Europe since being sworn in last month, comes amid a growing scandal at the White House following the resignation of Trump's national security adviser Michael Flynn.
Flynn quit over allegations he had discussed US sanctions with Russia's ambassador before taking office.
Mattis and Stoltenberg both insisted the Flynn scandal was not a cause for concern for the alliance, which has underpinned transatlantic security since the aftermath of World War II.
But NATO partners are worried about possible ties between other officials on Trump's campaign team and Moscow, which has alarmed former communist countries with its belligerent stance since the Crimea annexation.
During the previous Barack Obama administration, NATO agreed to send four multinational battalions to Poland and each of its three Baltic state members.
Also hanging over the meeting was a New York Times report that Moscow had deployed a new type of cruise missile, raising fears it would violate the Intermediate-range Nuclear Forces (INF) treaty.
Stoltenberg said any non-compliance with the treaty was of "serious concern" while Mattis said NATO would "defend ourselves if Russia chooses to act contrary to international law."
Prodded by the new Trump administration, NATO is also stepping up efforts to counter terrorist threats from North Africa and the Middle East.
NATO will set up "as soon as possible" a hub with 100 staff at the alliance's Joint Force Command in Naples, Italy, which will coordinate intelligence on crisis countries like Iraq and Syria, Stoltenberg said.
The alliance will also deploy surveillance drones in Sicily to get a better intelligence picture.
