Admiral William Fallon told a Senate confirmation hearing that "time is short" for the US to turn Iraq around.
His comments came on another day of bloodshed in Iraq.
About 40 people died and more than 100 were injured in a series of bomb and mortar attacks across Iraq as Shia Muslims celebrated the Ashura festival.
In Washington, Adm Fallon told the Senate Armed Services Committee that the previous US strategy in Iraq was "not working".
| || We need candid assessments, and you'll get them from me |
Adm William Fallon
"I believe the situation in Iraq can be turned around but time is short," he said.
"What we have been doing has not been working. [What] we have got to be doing, it seems to me, is something different."
Adm Fallon, who currently heads the military in the Pacific, is poised to become the first US navy officer to head Central Command, or Centcom.
He is replacing Gen John Abizaid, who is retiring after nearly four years as Centcom chief and if confirmed would become the immediate boss of Gen David Petraeus, who was recently confirmed as the commander of US forces in Iraq.
The commander's reputation as an able diplomat is being seen as an important asset at a very sensitive time for US policy in Iraq, says the BBC's James Coomarasamy, in Washington.
If confirmed, the admiral will have to oversee the deployment of more than 20,000 US troops in a "surge" operation in Iraq.
"There are no guarantees but you can depend on me for my best effort," Adm Fallon said.
| || We don't believe that [Iran's] behaviour, such as supporting Shia extremists in Iraq, should go unchallenged |
Nominee for deputy secretary of state
"We need candid assessments, and you'll get them from me."
Adm Fallon's comments echoed the grim but more realistic tone currently coming from the White House, our correspondent says.
Separately, John Negroponte, the first US director of intelligence and a former ambassador to Iraq and to the UN, now nominee for the post of deputy secretary of state, answered questions from the Senate Foreign Relations Committee.
He backed recent tough talk towards Iran, saying Tehran was meddling in Iraq, and insisted that a diplomatic channel was already open with Syria.
"I would characterise our policy as desirous of resolving any issues we have with Iran by peaceful means," he said.
"But at the same time, we don't believe that their behaviour, such as supporting Shia extremists in Iraq, should go unchallenged.
"If they feel that they can continue with this kind of activity with impunity, that will be harmful to the security of Iraq and to our interests in that country."
His comments came as Democrat Senator Barack Obama expressed fears that the US would inadvertently stumble into active hostilities with Iran.