"It is only government that can break the vicious cycle where lost jobs lead to people spending less money which leads to even more layoffs," Obama said.
The US president also said he was committed to maintaining a bi-partisan approach to government despite failing to convince Republicans to agree to the bill quickly.
"Old habits are hard to break," Obama said of Republican opposition to the bill.
Republicans have criticised the package, saying it contains too much unnecessary spending and too few tax cuts.
The US president also answered questions about foreign policy, saying that there could be "openings" for diplomatic talks with Iran in the coming months.
"We will be looking for openings that can be created where we can start sitting across the table face-to-face, diplomatic overtures that will allow us to move our policy in a new direction," Obama said.
'Town hall' meeting
Obama had held a "town hall" style meeting in Elkhart, Indiana, earlier on Monday to push the case for the stimulus package to the US public.
The US leader took a number of questions at the meeting, which was reminiscent of many held during his successful presidential election campaign last year.
The US House of Representatives has already passed one form of the stimulus bill, devoting more money to states, local governments and schools, while the senate has its own version which has a greater emphasis on tax cuts, following complaints from Republicans.
However, the two versions must be reconciled before both houses of congress can vote on - and approve - a final version.
The US economy is struggling with a downturn that most economists believe is already a recession.