Speaking at a press conference in Germany - one of the most monitored countries under Prism - he acknowledged he had a "healthy scepticism" of surveillance programmes when he first became president.
He said: "One of our highest ideals is civil liberty and privacy. What I have been able to do is examine and scrub how our security services operate."
Obama said he believed he had struck the right balance between national security and civil liberties explaining the programme only sought information from leads gained elsewhere.
He also emphasised its necessity, insisting it was a completely court-supervised process.
He said: "[Prism] applies very narrowly to leads we have obtained to issues relating to terrorism and proliferation of weapons of mass destruction.
"Based on those leads with court supervison and oversight we can access information.
"We are not rifling through the emails of ordinary emails of German citizens or American citizens or French citizens or anybody else."
The president insisted the furore around the revelations was a positive thing and he would further declassify more operations related to it.
He said: "We welcome these debates. This is what democracy is about.
"We do have to strike a balance. We do have to be cautious about how our governments operate when it comes to intelligence."
The Prism programme was exposed following the testimony of NSA whistleblower, Edward Snowden, 29, a former CIA technical assistant.
Prism is said to give the NSA and FBI easy access to the systems of nine of the world's top internet companies, including Google, Facebook, Microsoft, Apple, Yahoo and Skype.
Obama trumpeted the effectiveness of the programme claiming it had disrupted "at least 50 threats not just in America but here in Germany."
This has already been called into question by Democratic senator Ron Wyden who argues the thwarted plots were actually stopped using information gleaned from other surveillance methods.
There have been strong calls for a congressional investigation into Prism and related programmes.
German chancellor, Angela Merkel, has been under immense pressure recently to address the issue with Obama.
She said: "I made clear that although we do see the need for gathering information, the topic of proportionality is always an important one and the free democratic order is based on people feeling safe.
"That's why the question of balance and proportionality is something we will continue to discuss and where we have agreed further exchange of information between the German Interior Ministry and the authorities concerned in the United States."
The Prism row crossed the Atlantic after documents emerged suggesting British eavesdropping agency GCHQ had access to the system since at least June 2010.
Original Article
Source: huffingtonpost.co.uk
Author: Christopher York
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