Bush announced that restrictions on travel to Cuba by US citizens would be more strongly enforced and the information campaign against Cuba's communist government intensified.
Highlighting US efforts to persuade Castro to hold "free and fair elections," Bush said "the dictator has responded with defiance and contempt and a new round of brutal oppression that outraged the world's conscience."
The US president said the communist government will not change by its own choice. "But Cuba must change," Bush said.
Bush was speaking in the White House, commemorating the anniversary of Cuba's quest for independence beginning in 1868.
Bush said he had asked the Treasury Department to more strictly enforce restrictions on visits to Cuba by US nationals.
"We are strengthening enforcement of those travel restrictions to Cuba that are already in place," the president said.
Exceptions for family visits, to deliver humanitarian aid or conduct research "are too often used as a cover for illegal business travel and tourism, or to skirt the restrictions on carrying cash into Cuba," he said.
US loves to hate Cuban President
"We are cracking down on this deception," Bush added.
The US president also announced that Washington would be more lenient in taking in Cuban immigrants.
He said the administration was "working to ensure that Cubans fleeing the dictatorship do not risk their lives at sea."
Bush said greater efforts would be made to make broadcasts to Cuba and announced that Secretary of State Colin Powell and the Secretary of Housing and Urban Development Mel Martinez would co-chair a new Commission for Assistance to a Free Cuba.
Cuban-Americans, largely opposed to Castro, welcomed the new US measures.
"We are very, very pleased with the steps this government has taken," a Cuban-American and Republican Florida lawmaker Mario Diaz-Balart said.