Washington  - Moments after taking the oath of office, US President Barack Obama declared Tuesday the United States had ushered in a "new era of peace" and urged Americans to accept a greater responsibility to tackle the vast challenges confronting the nation.

"Starting today, we must pick ourselves up, dust ourselves off, and begin again the work of remaking America," Obama told millions of cheering onlookers lined along the National Mall, Washington's vast park that stretches from the inaugural site on the Capitol steps to the Lincoln Memorial.

Inheriting a battered economy and wars in Iraq and Afghanistan, Obama warned the United States is facing difficult challenges that require a "unity of purpose over conflict and discord."

"The challenges we face are real," he said. "They are serious and they are many. They will not be met easily or in a short span of time. But know this America: they will be met."

Foreshadowing his approach to the world, Obama said he will plot a course of working with allies to meet international problems and accept diplomacy and principle as the preferred path of foreign policy.

"Recall that earlier generations faced down fascism and communism not just with missiles and tanks, but with sturdy alliances and enduring convictions," he said.

"They understood that our power alone cannot protect us, nor does it entitle us to do as we please," he said.

"Instead, they knew that our power grows through its prudent use," he said "Our security emanates from the justness of our cause, the force of our example, the tempering qualities of humility and restraint." dpa