"Iraq has known many challenges, and in the past several weeks we've seen that there are still those who would kill innocent men, women and children to deny the Iraqi people the future they deserve.
"Today's step forward is another reminder that these enemies of the Iraqi people will fail. The United States will continue to stand with Iraq as a strong partner and as a friend."
The election, due to be held in early 2010, is viewed as crucial to consolidating the war-torn nation's fledgling democracy ahead of a withdrawal of US combat troops by August and a complete pullout by the end of 2011.
The vote is set for January 16 but the date has been thrown into doubt because of delays and wrangling over the system to be used in what will be the second national poll since the ouster of dictator Saddam Hussein in 2003.
"Tough challenges remain," Obama said, adding he expected there will be "difficult days to come."
"But this agreement advances the political progress that can bring lasting peace and unity to Iraq and allow for the orderly and responsible transition of American combat troops out of Iraq by next September."
He added the passing of the law sent "an important signal to the world about Iraq's democracy and national unity and I look forward to prompt approval of this law by Iraq's presidency council."
Vice President Joe Biden also congratulated the Iraqi leadership.
"I congratulate Iraqi political leaders on today's passage of amendments to the Iraq elections law. Today's vote by the members of the Council of Representatives will allow for parliamentary elections in January 2010, as mandated under the Iraqi constitution.
"These elections will be a critical step forward in advancing national unity and forming an inclusive government," Biden said, adding: "Our commitment and friendship to Iraq remain strong."
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