Department of Defense Procurement Reorganization Act of 1986

Department of Defense Procurement Reorganization Act of 1986 - Establishes in the Office of the Secretary of Defense the Office of Defense Procurement, to be headed by the Under Secretary of Defense for Procurement (Under Secretary). Makes the Under Secretary responsible for the centralized procurement of all property and services for the Department of Defense (DOD), all contract administration functions of DOD, and all competition advocates of DOD.

Brings under the Office of Defense Procurement: (1) all functions of DOD relating to the procurement of property and services; (2) all functions of the Defense Acquisition Regulation Council and of the Defense Logistics Agency; and (3) all functions of the Office of Small and Disadvantaged Business Utilization for the Department of Defense.

Prohibits entering into a contract for the full-scale development or procurement of a major system unless the Under Secretary has reviewed and approved the contract.

Requires all advocates for competition in DOD to be under the supervision, direction, and control of the Under Secretary. Requires advocates to report annually to the Under Secretary, describing their activities during the preceding year.