"Today I am proud to stand here with you in the middle of this great city, in the centre of Europe," began Obama to even greater cheers from a crowd estimated at 30,000 that all but filled the castle square.
The audience, who had hung around for hours after being sifted through stringent security checks, were rewarded after the speech when Obama and his wife walked down to meet the people.
"The speech was... well, refreshing," said Kathleen Delisle, an American who lives outside Prague. "And we almost shook hands with him. The guy in front of us actually did."
The crowd had earlier waited patiently waving their Stars and Stripes flags through a Bluegrass band performance.
They booed Czech politicians who came to shake hands with people at the front of the action before erupting with applause as the star of the show began his speech 20 minutes behind schedule.
Earlier in the morning, Prague's all-night revellers were outnumbered on the streets by an excitable crowd of Czechs and expatriates eager to catch a glimpse of the president in the flesh.
While party-goers sank their last beers, soup and sausage vendors plied a roaring trade around the castle.
"It's just brilliant to be able to see someone up close who is obviously going to change history," said journalism student Pavla Klimesova.
Along with her friends Klara and Zuzana, Pavla arrived in the middle of the night to get a prime spot to see Obama, who first proved his immense pulling power in Europe last year when hundreds of thousands came to see him in Berlin.
"I haven't slept a wink, I was too nervous," said Zuzana, who said she had been won over the "human touch" of the new incumbent of the White House.
A massive security operation was set up around Castle Square, where Obama's speech was also beamed on giant video screens.
Police sniffer dogs were out in force and all those who wanted to enter the square had to pass through tents with metal detectors.
When Obama finally came to speak, many of the crowd said they appreciated Obama's reference to milestones in the Czech history, although some felt it had been a bit of an anticlimax.
"He obviously got acquainted with a bit of Czech history. It was very flattering, very nice," said Ingrid Kusova, a Czech woman in her fifties.
"I decided to welcome my president in the city where I was born," said Daniela Simonova, a middle-aged woman who was born in Prague but has US citizenship.
"But I didn't like the speech much. He's a far better speaker than he showed here in Prague," said the woman clutching a US flag with the CND (Campaign for Nuclear Disarmament) sign in place of the stars.
Vaclav Sidorin from Prague, about twenty, shared her skepticism.
"It was a fairly general speech, he didn't say anything revolutionary," he said.
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