The newspaper quoted Bush as saying during a 30-minute interview that he made "a miscalculation of what the conditions would be" in post-war Iraq.
But he insisted the 17-month-long battle against resistance forces was the unintended by-product of a "swift victory" against Saddam Hussein's military, the Times reported on Thursday.
Bush said his strategy had been "flexible enough" to respond.
"We're adjusting to our conditions" in places like Najaf, the paper quoted him as saying.
The Times said Bush deflected further inquiries as to what had gone wrong with the occupation.
According to the Pentagon, 969 US troops have died in Iraq since the invasion, 828 of them since 30 April 2003. An additional 6690 soldiers have been wounded, most of them during the occupation.
Nearly 1000 US troops have been
killed since the invasion
In an interview published on Friday in newspaper USA Today, Bush said Americans would re-elect him to a second term even if they disagreed with his decision to invade Iraq.
Bush said voters "know who I am and I believe they're comfortable with the fact that they know I'm not going to shift principles or shift positions based upon polls and focus groups".
Bush told USA Today that: "The American people have seen me make the hardest of decisions. That's just going to have to be a part of their decision-making process."
In the Times interview, the president also discussed the issue of North Korea and Iran's nuclear ambitions, saying he would not be rushed to set deadlines.
The newspaper said: "Bush displayed none of the alarm about North Korea's growing arsenal that he once voiced regularly about Iraq."
On the leaders of North Korea and Iran the paper quoted him as saying: "I don't think you give timelines to dictators."
Bush also told the Times he would continue diplomatic pressure, adding: "I'm confident that over time this will work - I certainly hope it does."