Ireland should join a European Union defence force if it has freedom to get involved in military operations on a case-by-case basis, the ardfheis was told.
In addition, the EU would have to comply with UN principles and agree to pursue nuclear and biological weapons disarmament.
"If we are not negotiating now, then we cannot make sure that these terms of advantage to Ireland are included," Mr Gay Mitchell, Fine Gael's foreign affairs spokesman, said.
The ardfheis accepted a motion urging the Government to properly resource the Defence Forces to ensure "that they can protect the State and its citizens".
Mr Thomas Wallace-O'Donnell, a UCD Fine Gael delegate, said Fine Gael is "the only party with the courage to break the taboo about neutrality".
"We are not the type to sit on the fence. It is time to be rid of our splendid isolationism from other European Union member-states. We should be prepared to go step further and say that not only are we their friends, we are their allies," he said.
Supporting the call for Ireland to join a military alliance, University of Limerick delegate Mr James Lawless said it was important to emphasise that the European Union was "peace-loving".
In his address, Mr Mitchell said: "We have responsibilities. Fine Gael has been the only party to face up to these responsibilities and to grasp the nettle of Ireland's so-called neutrality.
"But being in favour of close co-operation at EU level doesn't mean neglecting relationships with the rest of the world, particularly the transatlantic relationship."
Although tensions in the current relationship between the EU and the US existed, both sides must ensure "that they do not become too distanced in the future. Friendship doesn't always mean saying what you think the other side wants to hear.
"If we become silent and acquiescent partners in every aspect of US foreign policy, then we sell ourselves short.
"Several US administrations have been of great assistance to Ireland, especially in moving forward the Northern Ireland peace process. But that does not mean that I, that Fine Gael, that Ireland, or that the European Union should not voice concerns on important matters of international significance," he said.
Meanwhile, Fine Gael's defence spokesman, Donegal TD Mr Dinny McGinley, said the Air Corps needed fighter aircraft.
"If this country were targeted in a terrorist attack, it would not be able to mount any sort of an adequate response and would probably have to turn to the UK or other neighbouring countries for assistance," he said.
