Shortly after 11 p.m. ET, John McCain phoned Obama to concede the election.
Obama's victory is an incredible watershed moment for the country, and the ultimate success of the civil rights movement of the 1960s, when Martin Luther King Jr. dreamed of a future when whites and blacks could live as equals.
"We have come to the end of a long journey. The American people have spoken and they have spoken clearly," McCain told supporters in Arizona in his concession speech. "Senator Obama has achieved a great thing for himself and his country."
McCain spoke gratuitously of the importance of Obama's win to African-Americans and the U.S. He also offered his sympathy to Obama for the passing of his grandmother just hours before Election Day.
"In a contest as long and difficult as this campaign has been, his success alone commands my respect for his ability and perseverance. But that he managed to do so by inspiring the hopes of so many millions of Americans, who had once wrongly believed they had little at stake, or little influence in the election of an American president, is something I deeply admire and commend him for achieving," McCain said.
To win the presidency, a candidate must get 270 votes from the Electoral College, which are awarded for winning the popular vote in a state. A candidate could potentially win the popular vote nationwide, but not win enough votes from the Electoral College, like Al Gore did in 2000.
Current results:
* Obama - 333
* McCain - 139
After Obama, a 47-year-old first-term senator from Illinois, won the Democratic nomination, he found himself squaring off against John McCain, 72, a veteran lawmaker and war hero who spent five-and-a-half years as a military prisoner in Vietnam.
McCain struggled to separate himself from the current Republican government of George W. Bush, whose approval ratings have plummeted to roughly 25 per cent.
McCain sold himself as a "maverick," frequently using the word in speeches and interviews, and said he would break from the Bush administration and shake up Washington. He also said he was the best candidate to tackle tough foreign policy issues, especially Iraq and the so-called "war on terror."
Obama ran on a campaign of hope and change, saying Americans were fed up with Bush's failed economic policies, a seemingly never-ending war in Iraq and an eroding of civil liberties. He said McCain would essentially bring another four years of the same.
On Tuesday, Obama took an early lead and before 10 p.m. ET he had won the key battleground state of Ohio, which no Republican has ever lost in modern times and still managed to secure the White House.
He later won the Republican states of Indiana and Florida, which no Democrat had managed to secure since Lyndon Johnson in 1964.
Obama also won 21 electoral votes in Pennsylvania, where McCain had focused much of his efforts in the final days of his campaign.
Democrats win Senate majority
Democrats have picked up several senate seats from the Republicans, including a win over Sen. Elizabeth Dole in North Carolina. In a controversial attack ad, she had suggested her rival, who teaches Sunday school, was an atheist.
In other senate races:
* Former governor Mark Warner won a seat for the Democrats in Virginia, a traditional Republican stronghold
* Democrat Jeanne Shaheen won in New Hampshire, formerly held by the Republicans
* Democrat Thomas Udall is expected to win a seat from the Republicans in New Mexico
The Democrats are trying to win 60 seats, which would give them a filibuster-proof Senate majority. But analysts have said that's a long shot.
Who is leading in which states:
* Georgia - 15 - McCain
* Indiana - 11
* Kentucky - 8 - McCain
* South Carolina - 8 - McCain
* Vermont - 3 - Obama
* West Virginia - 5 - McCain
* Virginia - 13 - Obama
* North Carolina - 15
* Ohio - 20 - Obama
* Connecticut - 7 - Obama
* Delaware - 3 - Obama
* Maine - 4 - Obama 3, McCain 1
* Maryland - 10 - Obama
* Massachusetts - 12- Obama
* New Jersey - 15 - Obama
* Tennessee - 11 - McCain
* Oklahoma - 7 - McCain
* Arkansas - 6 - McCain
* Alabama - 9 - McCain
* Florida - 27 - Obama
* Illinois - 21 - Obama
* Mississippi - 6 - McCain
* Missouri - 11
* New Hampshire - 4 - Obama
* Pennsylvania - 21 - Obama
* District of Columbia - 3 - Obama
* South Dakota - 3
* Arizona - 10
* Colorado - 9 - McCain
* Rhode Island - 4 - Obama
* Louisiana - 9 - McCain
* Michigan - 17 - Obama
* Wyoming - 3 - McCain
* Minnesota - 10 - Obama
* New Mexico - 5 - Obama
* North Dakota - 3 - McCain
* New York - 31 - Obama
* Texas - 34 - McCain
* Wisconsin - 10 - Obama
* Kansas - 6 - McCain
* Nebraska - 5
* Iowa - 7 - Obama
* Utah - 5 - McCain
* Oregon - 7 - Obama
* California - 55 - Obama
* Idaho - 4
* Hawaii - 3 - Obama
* Montana - 3
* Alaska - 4
* Nevada - 5
* Washington - 11 - Obama