By Andrea Shalal

RAF FAIRFORD, England (Reuters) - Lockheed Martin Corp's <LMT.N> F-35 fighter jets made their first appearance at the world's largest military air show on Friday, in what U.S. and British generals described as part of a larger drive to bolster NATO's defenses in Europe.

Six F-35 jets, including one owned by Britain, were on display at the Royal International Air Tattoo, drawing cheers from huge crowds two years after engine trouble and a fleetwide grounding prevented their international debut at the show.

One F-35 jet flight simulated refueling in midair, another showcased the aircraft flying with the F-22 Raptor fighter jet, also built by Lockheed, and a third showed how the jets can hover and land vertically.

U.S. Air Force Chief of Staff General David Goldfein told reporters the flights were meant to send a strong signal to Russia and other possible foes about NATO's resolve.

"This is a message to anyone internationally about what we bring to the fight with our coalition partners," he said, adding that the new jets' ability to gather and share intelligence represented the future of warfare.

The flights came as NATO leaders agreed to deploy military forces to Eastern Europe and increase air and sea patrols to reassure allies who were once part of the Soviet bloc following Russia's seizure of Crimea from Ukraine.

Launched 15 years ago, the world's largest weapons program was plagued for years by cost overruns and technical challenges, but with more than 180 F-35 jets now flying it is finally hitting its stride.

Production costs are coming down, the U.S. Air Force is poised to declare an initial squadron of jets ready for combat later this year, and new customers including Belgium and Switzerland are interested in buying the planes.

Lockheed is building three variants of the plane for the U.S. military, Britain, Turkey, Australia, Italy, Denmark, Norway, the Netherlands, Israel, Japan and South Korea. It expects to sell 3,000 jets in coming decades, with production expected to peak at around 170-180 airplanes a year around 2023, according to Lockheed officials.

The U.S. Marine Corps last week launched a second operational squadron of jets, and will send an initial squadron of 10 jets to Iwakuni, Japan, in January, said U.S. Lieutenant General Jon Davis, deputy Marine Corps commandant for aviation.

"This program is maturing. We're building mass and velocity, capability and confidence," Davis said in an interview.

Minister of Defence Procurement Philip Dunne said Britain was on track to declare an initial operational capability of the F-35 jets in 2018, and they would be deployed at sea once the new Queen Elizabeth aircraft carrier was done.

(Editing by Matthew Lewis)