
"If there is anyone out there who still doubts that America is a place where all things are possible, who still wonders if the dream of our founders is alive in our time, who still questions the power of our democracy - tonight is your answer," he told the throngs that gathered in Grant Park.
Obama said he recognized the "enormity" of challenges that would face him upon entering the White House, including wars in Afghanistan and Iraq and an economy on the verge of recession.
Amid huge support and high expectations from around the world, Obama offered a stark warning for US enemies and pledged to work with allies.
"A new dawn of American leadership is at hand. To those who would tear the world down, we will defeat you. To those who seek peace and security, we support you," he said.
The claps and cheers that punctuated his acceptance speech seemed more like the worship style at a typical African American church than a raucous political rally for the man who will be the nation's first black president.
Several women in the crowd waved their hands and called out "That's right" and "Thank God for that" as he spoke, but for the most part they listened in rapt attention.
Obama thanked his rival John McCain, who earlier offered a gracious concession speech of his own in Phoenix, Arizona, which recognized the historic nature of Obama's victory and promised to help him unite the country.
But Obama made little mention of the historic nature of his presidency. He reached out to all races and ethnicities, and even to McCain's own supporters.
"To those Americans whose support I have yet to earn: I may not have won your vote tonight, but I hear your voices. I need your help. I will be your president too," Obama said.
Obama reprised many of the uplifting themes that got him to the steps of the White House, telling supporters that the US electorate had warmed to his message of change, unity and a new kind of politics. He vowed to deliver on those promises as president.
"Americans have sent a message to the world that we have never been just a collection of red states and blue states. We are and always will be the United States of America," he said. dpa cc aw ar 050652 GMT Nov 08 nnnn
* Democratic candidate Barack Obama has won a historic US presidential election, television networks projected Tuesday, making him the first African-American ever to lead the United States.
Obama, 47, had a commanding victory over Republican rival John McCain, 72, capturing a series of reliable Republican states including Virginia and Ohio that voted for President George W Bush in the last two elections.
Obama was put over the top as US networks projected victories in California, Washington and Oregon as soon as polls in those states closed at 11 pm (0400 GMT).
A deafening roar went out from the tens of thousands of supporters gathered at Obama's victory rally in Chicago's Grant Park. Obama was to address the crowd later in the evening.
Obama had already taken a commanding lead in the US presidential election before the official projection, capturing the key swing states of Pennsylvania and Ohio earlier in the night and leaving McCain with an almost impossible uphill battle to keep his hopes alive.
No candidate has captured the White House without Ohio's 20 electoral votes since 1960. No Republican has ever won the presidency without it. Similarly in Virginia, no Democrat has won the state since1964.
Pennsylvania, with 21 electoral votes, had been considered McCain's best shot of capturing a reliable Democratic state. McCain did not win a single state taken by Democrat John Kerry four years ago.
A total of 270 electoral votes is needed to win in the country's state-by-state, winner-takes-all US electoral system. The count stood at 290 electoral votes for Obama and 145 for McCain.
Some of the other key states captured by Obama included Michigan, Wisconsin, New Hampshire, New Mexico and Iowa. Georgia, South Carolina, Louisiana and Texas were some of the largest taken by McCain.
Millions of voters had waited for hours at polling stations across the country as McCain and Obama made a final push for votes in swing states.
In Chicago, the disproportionately young crowd awaiting Obama's rally had a large representation of both whites and blacks, with small numbers of Latinos and Asians. Tiffany Gholar, 29, a Chicago student and executive assistant, said that Obama's victory "would make me feel like some real progress has been made since the civil rights movement."
McCain's campaign was holding an evening rally at a hotel in Phoenix, Arizona.
Democrats worked on the hope that eight years of President George W Bush's unpopular policies in Iraq and the slumping economy would convince voters to hand them control of the White House and strengthen their control of Congress.
The Democrats picked up at least four seats from Republicans in the Senate and were poised to make significant gains to widening their majorities in both congressional houses, network projections showed.
The faltering US economy was by far the top concern of voters heading to the polls in Tuesday's general election, according to initial exit polls reported by US broadcaster CNN.
A full 62 per cent of voters ranked the economy as the key issue of this election, compared to 10 per cent invoking the war in Iraq and 9 per cent rating terrorism or health care highest.
Millions already voted in recent weeks in early or absentee voting allowed in 31 states, including key battlegrounds Florida, North Carolina, Colorado and Nevada.
Voters waited patiently in serpentine queues early Tuesday to cast ballots. Many had started lining up before dawn, and some braved pouring rain to cast their ballots.
It was a bittersweet end to the 21-month campaign for Obama, whose grandmother, Madelyn Dunham, 86, passed away overnight Sunday after a battle with cancer, the Illinois senator revealed Monday.