Young and charismatic but with little experience on the national level, Obama smashed through racial barriers and easily defeated Republican John McCain to become the first African-American destined to sit in the Oval Office, America's 44th president. He was the first Democrat to receive more than 50 percent of the popular vote since Jimmy Carter in 1976.
"It's been a long time coming, but tonight, because of what we did on this date in this election at this defining moment, change has come to America," Obama told a victory rally of 125,000 people jammed into Chicago's Grant Park.
Obama scored an Electoral College landslide that redrew America's political map. He won states that reliably voted Republican in presidential elections, like Indiana and Virginia, which hadn't supported the Democratic candidate in 44 years. Ohio and Florida, key to Bush's twin victories, also went for Obama, as did Pennsylvania, which McCain had deemed crucial for his election hopes.
With most U.S. precincts tallied, the popular vote was 51.9 percent for Obama and 46.8 percent for McCain. But the count in the Electoral College was lopsided in Obama's favor over McCain - 349 to 147 as of early Wednesday, with three states still to be decided. Those were North Carolina, Georgia and Missouri.
With just 76 days until the inauguration, Obama is expected to move quickly to begin assembling a White House staff and selecting Cabinet nominees.
Campaign officials said Illinois Rep. Rahm Emanuel was the front-runner to be Obama's chief of staff. The advisers spoke on a condition of anonymity because the announcement had not yet been made.
"We're in deep trouble. Our country needs strong leadership and Barack Obama is prepared to offer that leadership," Rep. John Lewis, a Georgia Democrat and leading player in the civil rights movement, said Wednesday on NBC's "Today" show.
"We've got to get our economy out of the ditch, end the war in Iraq and bring our young men and women home, provide health care for all our citizens," Lewis said. "And he's going to call on us, I believe, to sacrifice. We all must give up something."
Democrats expanded their majority in both houses of Congress. In the Senate, Democrats ousted Republicans Elizabeth Dole of North Carolina and John Sununu of New Hampshire and captured seats held by retiring GOP senators in Virginia, New Mexico and Colorado. Still, the GOP blocked a complete rout, holding the Kentucky seat of Senate Minority Leader Mitch McConnell and a Mississippi seat once held by Trent Lott - two top Democratic targets.
In the House, with fewer than a dozen races still undecided, Democrats captured Republican-held seats in the Northeast, South and West and were on a path to pick up as many as 20 seats.
When Obama and running mate Joe Biden take their oath of office on Jan. 20, Democrats will control both the White House and Congress for the first time since 1994.
"It is not a mandate for a party or ideology but a mandate for change," said Senate Majority Leader Harry Reid of Nevada.
House Speaker Nancy Pelosi of California said: "Tonight the American people have called for a new direction. They have called for change in America." She scheduled a midday news conference on Capitol Hill Wednesday to talk about the election.
After the longest and costliest campaign in U.S. history, Obama was propelled to victory by voters dismayed by eight years of George W. Bush's presidency and deeply anxious about rising unemployment and home foreclosures and a battered stock market that has erased trillions of dollars of savings for Americans.
Six in 10 voters picked the economy as the most important issue facing the nation in an Associated Press exit poll. None of the other top issues - energy, Iraq, terrorism and health care - was selected by more than one in 10. Obama has promised to cut taxes for most Americans, get the United States out of Iraq and expand health care, including mandatory coverage for children.
Obama acknowledged that repairing the economy and dealing with problems at home and overseas will not happen quickly. "We may not get there in one year or even in one term," he said. "But, America, I have never been more hopeful than I am tonight that we will get there. I promise you, we as a people will get there."
McCain conceded defeat shortly after 11 p.m. EST, telling supporters outside the Arizona Biltmore Hotel, "The American people have spoken, and they have spoken clearly."
"This is an historic election, and I recognize the special significance it has for African-Americans and the special pride that must be theirs tonight," McCain said. "These are difficult times for our country. And I pledge to him tonight to do all in my power to help him lead us through the many challenges we face."
Obama faces a staggering list of problems, and he mentioned some of them in his victory speech. "Even as we celebrate tonight, we know the challenges that tomorrow will bring are the greatest of our lifetime — two wars, a planet in peril, the worst financial crisis in a century." He spoke of parents who worry about paying their mortgages and medical bills.
"There will be setbacks and false starts," Obama said. "There are many who won't agree with every decision or policy I make as president. And we know the government can't solve every problem."
The son of a Kenyan father and a white mother from Kansas, the 47-year-old Obama has had a startlingly rapid rise, from lawyer and community organizer to state legislator and U.S. senator, now just four years into his first term. He is the first senator elected to the White House since John F. Kennedy in 1960.
Bush called Obama with congratulations at 11:12 p.m. EST. "I promise to make this a smooth transition," the president said. "You are about to go on one of the great journeys of life. Congratulations and go enjoy yourself." He invited Obama and his family to visit the White House soon.
Bush planned to make a statement about the election at midmorning Wednesday in the Rose Garden.
Obama won California, Colorado, Connecticut, Delaware, the District of Columbia, Florida, Hawaii, Illinois, Indiana, Iowa, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Hampshire, New Jersey, New Mexico, New York, Ohio, Oregon, Pennsylvania, Rhode Island, Virginia, Vermont, Washington and Wisconsin.
McCain had Alabama, Arizona, Arkansas, Idaho, Kansas, Kentucky, Louisiana, Mississippi, Montana, Nebraska, North Dakota, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, West Virginia and Wyoming. He also won at least 3 of Nebraska's five electoral votes, with the other two in doubt.
Almost six in 10 women supported Obama nationwide, while men leaned his way by a narrow margin, according to interviews with voters. Just over half of whites supported McCain, giving him a slim advantage in a group that Bush carried overwhelmingly in 2004.
The results of the AP survey were based on a preliminary partial sample of nearly 10,000 voters in Election Day polls and in telephone interviews over the past week for early voters.
In terms of turnout, America voted in record numbers. It looks like 136.6 million Americans will have voted for president this election, based on 88 percent of the country's precincts tallied and projections for absentee ballots, said Michael McDonald of George Mason University. Using his methods, that would give 2008 a 64.1 percent turnout rate.
"That would be the highest turnout rate that we've seen since 1908," which was 65.7 percent, McDonald said early Wednesday.