U.S. President Barack Obama says he will return to the White House "more determined and inspired than ever" after defeating Republican rival Mitt Romney and winning a second term as president.

"Tonight in this election, you, the American people, reminded us that while our road has been hard, while our journey has been long, we have picked ourselves up, we have fought our way back," Obama said during a victory speech in his hometown of Chicago. "And we know in our hearts that for the United States of America, the best is yet to come."

The 51-year-old incumbent also said he had spoken with Romney and congratulated him on a hard-fought campaign.

To win, a candidate needed to secure 270 electoral votes. Major U.S. networks projected that Obama had achieved his long-sought goal of four more years in the White House even before some of the key battleground states were declared, such as Florida, Virginia and Nevada.

Republican presidential candidate Mitt Romney concedes the presidency at the Boston Convention & Exhibition Center in Boston, Mass. (Joe Raedle/Getty)

Obama had won much of the traditionally Democratic northeastern U.S. early in the night, including Pennsylvania, while Republican challenger Romney secured the conservative base across a swath of states including Texas and Georgia.

But the president sealed his victory with wins in Ohio, Iowa, New Hampshire and Colorado, four of nine battleground states where the two rivals and their allies spent nearly $1 billion on duelling television commercials.

Late Tuesday night, Romney reportedly called Obama to concede the election, and later addressed a crowd of supporters gathered at his campaign headquarters in Boston.

"This is a time of great challenges for America, and I pray that the president will be successful in guiding our nation," Romney said in a brief speech.

"The nation as you know is at a critical point. At a time like this, we can't risk partisan bickering and political posturing," he said. "Our leaders have to reach across the aisle to do the people's work, and we citizens also have to rise to the occasion."

Romney also thanked his running mate, Paul Ryan, saying that "besides my wife Ann, Paul is the best choice I've ever made."

The two rivals were close in the popular vote. With votes counted in 88 per cent of the nation's precincts, Obama had received 55.8 million votes, or about 49.8 per cent. Romney. Romney had 54.5 million, or 48.6 percent.

Results were still trickling in early Wednesday, but The Associated Press showed Obama with more than 300 electoral votes to Romneys 206.

Hard-fought race

Democrats were in a partying mood over news of Obama's re-election.

In Obama's hometown of Chicago, the U.S. network projections prompted roars of jubilation that CBC's Neil Macdonald said lasted for at least 10 minutes.

But the security of having a second term comes with high expectations for the next four years. Macdonald noted that Obama's efforts at reaching across the aisle with his Republican colleagues led to chronic frustration during his first term.

"He was rebuffed at every turn. He was obstructed by the Republicans. Time to stop playing softball; time to dispense with this nonsense," Macdonald said. "You don't have to get re-elected. Time to get priorities passed."

Ultimately, the result of the bruising election campaign appeared to be a return to the political status quo. Democrats won two more years of control of the Senate, and Republicans did likewise in the House.

Both the Obama and Romney camps cast the election day decision as one with far-reaching repercussions for a nation still recovering from the biggest economic downturn since the Great Depression and at odds over how big a role government should play in solving the country's staggering debt and high unemployment.

Obama will be tasked with a laundry list of pressing issues in his second term, including whether to scrap the Bush tax cuts, how to fill expected Supreme Court vacancies, and how to navigate the U.S. "fiscal cliff" negotiations, which are set to begin after Tuesday's votes are tallied.

With files from The Associated Press