Clinton said the literature distibuted by Obama's team deliberately misrepresented her health care proposal, which includes mandates requiring Americans to purchase health insurance.
He said Clinton's characterisation of his plan, which proposes that Americans should not be mandated to have health care, were part of a sustained attack against him.
"Senator Clinton has ... constantly sent out negative attacks on us, email, robo-calls, flyers, television ads, radio calls, and we haven't whined about it because I understand that is the nature of these campaigns," he said.
"But to suggest somehow that our mailing is somehow different from the kinds of approaches that Senator Clinton has taken throughout this campaign I think is simply not accurate."
Both candidates denounced the record of George Bush, the US president, on Iraq, but clashed over which of them was more opposed to the war.
Clinton said she and Obama had virtually identical voting records on the war since he came to the senate in 2005.
Obama referred to Clinton's 2002 vote to authorise the war, at a time when he was not yet in congress, in an attempt to rebut claims by Clinton that he is too inexperienced to be president.
Barack Obama: Alabama, Alaska, Colorado, Connecticut, Delaware, Georgia, Hawaii, Idaho, Illinois, Iowa, Kansas, Louisiana, Maine, Maryland, Minnesota, Missouri, Nebraska, North Dakota, South Carolina, Utah, Virginia, Washington state, Wisconsin - 1,192 delegates
Hillary Clinton: Arizona, Arkansas, California, Florida, Massachusetts, Michigan, Nevada, New Hampshire, New Jersey, New York, Oklahoma, Tennessee - 1,036 delegates
2,025 delegates are required to secure the Democratic nomination for the presidential election
"The fact is that Senator Clinton often says that she is ready on day one, but, in fact, she was ready to give in to George Bush on day one on this critical issue," Obama said.
The rivals also debated Nafta, a free trade agreement with Canada and Mexico that is unpopular with working-class workers in states such as Ohio, where a primary contest will take place on Tuesday.
Neither candidate said they would withdraw from the agreement but both said they would pressure Mexico to make changes.
"I have said I would renegotiate Nafta," Clinton said. "I will say to Mexico that we will opt out of Nafta unless we renegotiate it."
Obama said Clinton has been ambivalent on the trade deal, saying that she had been touting the agreement in farm states - where it is popular - while finding fault in places like Ohio.
"This is something I have been consistent about," Obama said, adding that he went to the American Farm Bureau Federation to signal his opposition and used it as an issue in his 2004 senate campaign.
Clinton and Obama also spoke about the direction of Russia, in the run up to a vote to elect a successor to Vladimir Putin, the Russian president.
Clinton stumbled over the name of Dmitry Medvedev, the Putin-backed candidate who is favourite to win the election on Sunday.
"I can tell you that he's a hand-picked successor, that he is someone who is obviously being installed by Putin, who Putin can control, who has very little independence," she said.
"This is a clever but transparent way for Putin to hold on to power, and it raises serious issues about how we're going to deal with Russia going forward."
Obama criticised the Bush administration for failing to keep a close check on Moscow.
"[Bush] then proceeded to neglect our relationship with Russia at a time when Putin was strangling any opposition in the country, when he was consolidating power, rattling sabres against his European neighbours, as well as satellites of the former Soviet Union," he said.
The debate came in the same week that a photo of Obama wearing a white turban and robe presented to him by elders in Wajir, in northeastern Kenya, surfaced on a news website.
The Drudge Report website posted the photograph on Monday and said, without substantiation, that it had been circulated by staff members on Clinton's campaign.
|A photo of Obama wearing a turban and robe|
ignited claims of 'dirty tricks' [EPA]
"We have no evidence where it came from," Clinton said, rejecting claims that it was part of a dirty tricks campaign against Obama.
"I take Senator Clinton at her word that she knew nothing about the photo," Obama said.
Obama has chalked up 11 consecutive contest wins for the Democratic nomination ahead of November's presidential election.
Delegates are proportionally awarded on the basis of vote results, with the first to 2,025 delegates winning the nomination. Obama has 1,192 delegates to Clinton's 1,036.
Clinton needs to win in the key states of Texas and Ohio, which carry a total of 390 delegates, on Tuesday to halt Obama's run of victories and boost her faltering campaign.
Vermont and Rhode Island also go to the polls on the same day.