President Obama says no one person or agency is to blame for the lapses that allowed the incident to take place. But he says it is his responsibility to keep the American people safe.
"I am less interested in passing out blame than I am in learning from and correcting these mistakes to make us safer. For ultimately, the buck stops with me. As president, I have a solemn responsibility to protect our nation and our people, and when the system fails it is my responsibility."
The president spoke Thursday after spending several days reading a report on the incident and meeting with top officials to analyze what went wrong.
"Now, at this stage in the review process it appears that this incident was not the fault of a single individual or organization, but rather a systemic failure across organizations and agencies."
A 23-year-old Nigerian, Umar Farouk Abdulmutallab, boarded a U.S.-bound passenger plane in Amsterdam on Christmas Day, and tried but failed to detonate explosives sewed into his underwear. His father had previously alerted U.S. authorities that his son had become involved with Muslim extremists.
The president's counterterrorism adviser, John Brennan, says U.S. officials did not fail to collect or share intelligence on the plot, but they did fail to connect it to Abdulmutallab.
"We saw the plot was developing, but at the time, we did not know, in fact, that they were talking about sending Mr. Abdulmutallab to the United States."
To guard against future terror plots, Mr. Obama announced a series of changes in intelligence and security procedures. Among them are quicker and wider distribution of intelligence reports and new procedures for devising terror watch lists.
The president said the changes will help the U.S. intelligence community move more quickly.
"In the never-ending race to protect our country, we have to stay one step ahead of a nimble adversary. That's what these steps are designed to do."
White House officials say security will be tightened in U.S. airports, including more behavior analysis, explosives-sniffing dogs, and full-body scans.
Even so, President Obama says the country will not give in to a siege mentality.
"Great and proud nations do not hunker down and hide behind walls of suspicion and mistrust. That is exactly what our adversaries want, and so long as I am president, we will never hand them that victory."
The president said Americans will define the character of their country, not terrorists.