Obama raised his right hand and rested his left on Bibles once owned by Martin Luther King and Abraham Lincoln, on an outdoor platform set on the West Front of the US Capitol building and below its elegant white dome.
"I Barack Hussein Obama ..." the 44th president said, vowing to faithfully execute his office and to "preserve, protect and defend the constitution," led in the oath of office by black-robed Chief Justice John Roberts.
The president was earlier announced with a peal of trumpets and walked down the steps from the iconic building to a huge cheers of "Obama, Obama" from a vast crowd stretching into the distance down the National Mall below.
Obama, his smile beaming wide, appeared more relaxed than at his first inauguration four years ago, when he took office as an untested and inexperienced leader as an economic depression threatened.
The president, the first African American to hold the office, launched his second term with a private swearing-in ceremony on Sunday, before basking in the full pomp of his office with public celebrations Monday.
Obama was shortly to set the rhetorical tone for the remainder of his presidency with an inaugural address and then will headline a parade and then waltz with the first lady at glittering inaugural balls.
Bundled-up Obama supporters trekked into town to join snaking lines for Secret Service checkpoints guarding a steel-fenced secure zone around the White House and the inaugural parade route.
Three hours before the inauguration, the crowd built between the Stars and Stripes-draped US Capitol building, where Obama will take the oath, and the marble obelisk of the Washington monument, soaring into the sky.
Armored military vehicles and parked buses blocked major roads, as part of a security vice which included air and river exclusion zones, road closures and a heavy presence of police and National Guard reserve troops.
Temperatures were forecast for a relatively comfortable upper 30 degrees Fahrenheit (3 to 4 degrees Celsius), much warmer than the bitter chill that has had crowds shivering at some previous inaugurations.
Though the mood was festive, as revelers crammed into coffee shops and subway trains heading downtown, Obama's second inauguration lacks the sense of historic promise and hope that greeted his first term in 2009.
Dignitaries, including former Democratic presidents Jimmy Carter and Bill Clinton, and Secretary of State Hillary Clinton, took their seats on a platform at the West Front of the Capitol.
One Obama supporter, the Reverend Ruddie Mingo, 54, donated time and money to the president's winning campaign against Republican Mitt Romney, and said inaugural festivities were less mobbed than four years ago.
"My hope is that his next four years we can get more stuff accomplished on both sides," he said.
Obama's political brand has been damaged by an exhausting first term battling the worst economic storm in decades and brutal partisan warfare with his Republican rivals, notably over taxes and spending.
The president started his day in traditional fashion for presidents on inauguration day, worshipping at the St John's Episcopal Church opposite the White House with his family.
When he returns to politics, Obama, 51, has a legacy to defend, including a historic health care law and a retrenchment from draining wars abroad, and he is vowing to make good on the promise of a fairer economy.
He signaled late Sunday, at a reception for supporters, that he would dwell on the "common good" and the "goodness, the resilience, neighborliness, the patriotism" of Americans in his address.
"What we are celebrating is not the election or the swearing in of the president, what we are doing is celebrating each other and celebrating this incredible nation that we call home," Obama said.
"And after we celebrate, let's make sure to work as hard as we can to pass on an America that is worthy not only of our past, but also of our future."
Obama took the oath for a first time Sunday in a private ceremony at the White House because the constitution states that US presidential terms end at noon on January 20.
When that date falls on a Sunday, there is a private swearing-in ceremony before public celebrations and a second oath taking the next day.
Poignantly, Obama took second, second term oath of office on the federal holiday marking civil rights pioneer King's birthday.
In another historic echo, Obama was the second president to be sworn in four times -- thanks to the Roberts stumble in 2009 and his double oath duty this year, joining Democratic icon Franklin Roosevelt.
As well as political wrangles at home, Obama faces several boiling foreign crises likely to shape his legacy.
The US confrontation with Iran is fast-headed to a critical point with the specter of military action becoming ever more real the longer diplomacy over Tehran's nuclear program remains stuck in neutral.
And terror strikes that killed Americans in Benghazi and Algeria call into question Obama's election year sound bite that "Al-Qaeda is on the run," despite the killing of Osama bin Laden in Pakistan in 2011.