"It is increasingly clear that intelligence was not fully analyzed or fully leveraged," Obama said, suggesting that missed "red flags" before the attack were "potentially disastrous" and more serious than originally thought.
"That's not acceptable, and I will not tolerate it," Obama said.
As the White House faced intense political pressure over its response to the attack, press secretary Robert Gibbs insisted that the FBI had extracted "actionable" intelligence from bomb suspect Umar Farouk Abdulmutallab, 23.
Republicans have faulted the decision to put Abdulmutallab into the criminal justice system, rather than declare him an "enemy combatant" and submit him to military questioning and justice.
"Abdulmutallab spent a number of hours with FBI investigators in which we gleaned usable, actionable intelligence," Gibbs said.
Obama also announced he would suspend transfers of Guantanamo Bay prisoners to Yemen, after blaming an Al-Qaeda affiliate in the Arab country for plotting the attack, but vowed he would make good on his promise to close the camp.
"Make no mistake. We will close Guantanamo prison, which has damaged our national security interests and become a tremendous recruiting tool for Al-Qaeda," Obama said.
Gibbs said the decision to temporarily halt the transfer of prisoners from the camp to Yemen, could mean more could be sent to Thomson Correctional Center in Illinois, selected by the administration to hold Guantanamo Bay inmates.
Obama said two probes into the botched plot to blow up a Northwest plane showed US intelligence missed other "red flags" as well as the already revealed fact that Abdulmutallab was a Nigerian extremist who had traveled to Yemen.
He said US intelligence knew that the group Al-Qaeda in the Arabian Peninsula wanted to strike not only US targets in Yemen but in the United States itself over the holiday season.
"The bottom line is this -- the US government had sufficient information to have uncovered this plot and potentially disrupt the Christmas Day attack, but our intelligence community failed to connect those dots," Obama said.
"In other words, this was not a failure to collect intelligence, it was a failure to integrate and understand the intelligence that we already had.
"When a suspected terrorist is able to board a plane with explosives on Christmas Day, the system has failed in a potentially disastrous way," Obama said.
"It's my responsibility to find out why, and to correct that failure so that we can prevent such attacks in the future," Obama said.
Obama promised that in the coming weeks, he would lay out further steps to safeguard aviation security, including better integration of information and enhanced passenger screening.
He promised a summary of a preliminary report into the intelligence failures would be made public within the next few days, and demanded swift action to close the gaps.
"I want specific recommendations for corrective actions to fix what went wrong. I want those reforms implemented immediately so that this doesn't happen again and so we can prevent future attacks."
The State Department, meanwhile, said Tuesday it had revoked more visas for people with "suspected ties to terrorism."
"It's based on our assessment of ... the risk associated with specific individuals, on information that we have, you know, from various sources," said spokesman PJ Crowley.
Many experts have expressed incredulity that Abdulmutallab was able to travel on a valid US visa, despite his suspected ties to extremists.
Abdulmutallab is accused of attempting to bring down the Northwest jet outside Detroit with explosives sewn into his underwear. He was thwarted by passengers and crew.
Obama's high-powered meeting included the heads of the CIA, the FBI, the National Security Agency and the National Counterterrorism Center, as well as Secretary of State Hillary Clinton and Defense Secretary Robert Gates.
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