Democrats kept the Senate, but fell short of the 60-vote super majority needed to sidestep Republican blocking tactics.
The president paved the way to victory with a staunch defense of Democratic bastions in Pennsylvania, Wisconsin and Michigan, at which Romney had taken a last-minute run when he saw more conventional paths to the White House blocked.
Obama also locked in swing states, including Virginia — where he became the first Democrat to win since 1964 four years ago — Nevada, Ohio, New Hampshire, Colorado and Iowa, crushing Romney’s slim hopes of a viable path to victory.
Romney could only wrestle Indiana and North Carolina from Obama’s 2008 map.
The victory in Iowa will be especially sweet for Obama, as the heartland state nurtured his unlikely White House dreams back in 2007. A tear rolled down his cheek as he held his last-ever campaign rally there late on Monday.
His victory in Ohio represents a delayed repayment for his gutsy call in 2009 to mandate a federal bailout of the auto industry, on which one in eight jobs in the state depend. Romney had opposed the move.
Obama won with a fiercely negative campaign branding Romney — a multimillionaire former corporate turnaround wizard — as indifferent to the woes of the middle class.
Exit polls showed that though only 39 percent of people believed that the economy was improving, around half of Americans blamed former Republican US president George W. Bush for the tenuous situation and not Obama.
Obama’s victory was a complete vindication for a campaign team that had predicted a close, but winnable election, despite the painful after-effects of the deepest economic crisis since the 1930s Great Depression.
He was also helped by Latino voters, whose strong support was crucial in the desert state of Nevada and the Rocky Mountain state of Colorado.
Republicans had insisted right up to election day that Obama’s army, disaffected by busted expectations for his first term, would stay at home and had predicted instead a late Republican wave that would elevate Romney.
The president ran for re-election on a platform of offering a “fair shot” to the middle class, of fulfilling his pledge to end the war in Iraq, killing former al-Qaeda leader Osama bin Laden and starting to build a clean energy economy.
Now Obama will face a showdown with Republicans on Capitol Hill, over the so-called “fiscal cliff” involving the expiry of Bush-era tax cuts and a need to raise the US debt ceiling.
Ruinous budget cuts designed to trim the ballooning deficit, which could tip the US economy into recession, are also about to come due, unless Obama can reach a deal with the Republicans, who have opposed him tooth and nail for four years.
The president may have been helped at the 11th hour when Hurricane Sandy roared ashore, killing more than 100 Americans, but giving Obama the chance to project leadership as the head of a multi-state disaster response.