Obama said America's first line of defense is "timely, accurate" intelligence that is properly integrated. "That's not what happened" before the attack, he said.
Obama cited three problems that contributed to the government's failure to prevent the attack.
First, the intelligence community didn't aggressively follow up on particular warnings.
Second, there was a larger failure to "connect the dots" within the intelligence community.
Third, there were shortcomings in the government's "watch list" system that prevented the alleged bomber from getting on the no-fly list.
There was "a failure to connect and understand the intelligence that we already had," Obama said.
The president said he had ordered four reforms.
First, he ordered the intelligence community to assign responsiblity to individuals to pursue leads on specific high-priority threats.
Second, intelligence reports will be distributed more widely and quickly.
Third, Director of National Intelligence Dennis Blair will overhaul existing intelligence analytical efforts.
Fourth, the government will strengthen the criteria used to add people to no-fly list.
Obama also said he was directing the Homeland Security Department to improve international partnerships to boost screening at airports around the world. The Department of Energy will work to develop better screening technology, he said.
Obama said he was establishing accountability reviews for agencies. His national security adviser John Brennan will report to him every 30 days on the reviews, he said.
There is "no silver bullet" to securing all flights coming into America every day, Obama warned. "Ultimately the buck stops with me."
Updated: 5:04 p.m.