Obama came to power promising that an overhaul of immigration legislation would be a top priority, but other major issues, such as the global economic downturn, healthcare policy and the Gulf oil spill, have pushed it down the agenda.
He said that he wanted a comprehensive solution to the issue, meaning "accountability for everybody" from the government meeting its obligation to secure the border, to businesses facing the consequences of knowingly employing illegal immigrants, to those immigrants owning up before they can begin the process of becoming citizens.
Thursday's speech was an attempt to ignite new momentum behind attempts to change the system.
Obama blamed "political posturing and special interest wrangling" for the lack of willingness to address immigration.
"I'm ready to move forward, the majority of Democrats are ready to move forward and I believe the majority of Americans are ready to move forward"
"The question now is whether we will have the courage and the political will to pass a bill through congress, to finally get it done," Obama said.
"I'm ready to move forward, the majority of Democrats are ready to move forward and I believe the majority of Americans are ready to move forward.
"But the fact is that without bipartisan support, as we had just a few years ago, we cannot solve this problem."
However, with legislators reluctant to take on the divisive issue in an election year, prospect still appear bleak for getting a bill to Obama's desk before congressmen leave Washington DC in August to campaign for re-election.
Al Jazeera's Patty Culhane reporting from the US capital, said: "President George Bush, [Obama's] predecessor, tried to push for immigration reform and the only reason it failed was because his own party didn't support him.
"There are a lot of people in Washington who say Obama's attempt won't succeed, not only because it's so controversial but because we're coming up on an election and there's a fear for both parties that they will alienate this huge Hispanic voting block.
"I don't know that there is an appetite in Congress to get this thing passed."
Recent developments on immigration influenced his decision to give Thursday's speech, White House officials said, most notably Arizona's enactment of a tough anti-immigrant law and protests across the country against it.
Bill Burton, a White House spokesman, said: "He [Obama] thought this was a good time to talk plainly with the American people about his views on immigration."
The Arizona law requires police enforcing another statute to clarify a person's immigration status if there's reason to believe the individual is in the US illegally.
Several states and communities are considering similar legislation, which Obama says is an understandable byproduct of the public's frustration over the federal government's inability to tighten the immigration system.
But Obama also has criticised the law as "misguided" and said it is potentially discriminatory.
He has asked the justice department to review its legality and immigrant advocates are hoping the government will sue Arizona to block the law from taking effect later this month.