Washington/Chicago - A steady flow of well-wishes came in from around the world Wednesday after Democratic candidate Barack Obama's historic victory made him the first African American ever to be elected president of the United States.

Obama, 47, stormed to victory Tuesday night over Republican rival John McCain, 72, capturing a series of reliable Republican states that voted for President George W Bush in the last two elections, including Virginia, Ohio, Florida, Colorado and Nevada.

But there was little time for the president-elect to rest. Transition talks have already been well underway and Obama planned to meet with his top advisors later Wednesday to discuss their next moves, US media reported.

President George W Bush, who will turn the White House over to Obama on January 20, promised a smooth transition and hailed Obama's win as a great American story.

"No matter how they cast their ballots, all Americans can be proud of the history that was made yesterday," Bush said in a brief statement at the White House Rose Garden Wednesday. "Many of our citizens thought they would never live to see that day."

With the US involved in two wars and an economy on the verge of recession, Obama will face pressure to appoint cabinet posts quickly and get advisors involved in key policy making.

Obama basked in his victory shortly after midnight Wednesday before a crowd of nearly a quarter million people that had gathered in Chicago's Grant Park.

"If there is anyone out there who still doubts that America is a place where all things are possible, who still wonders if the dream of our founders is alive in our time, who still questions the power of our democracy, tonight is your answer," he said.

McCain offered a gracious concession speech in Phoenix, Arizona. He recognized the "historic" nature of an African American taking the highest office in the land and promised to help Obama unite a country that remains sharply divided.

"In a contest as long and difficult as this campaign has been, his success alone commands my respect for his ability and perseverance," McCain told a crowd of downcast supporters, who booed at his mention of Obama.

Sporadic celebrations broke out across the country upon news of Obama's victory and statements of congratulations poured in from leaders around the world. Many noted Obama's inspirational qualities and voiced hope that he would repair the US' tarnished image after eight years of an unpopular Bush administration.

Obama won the popular vote by 52 per cent, to 46 per cent for McCain. But state victories were the key in the country's state-by- state, winner-takes-all electoral system.

A total of 270 electoral votes is needed. The count stood Wednesday at 349 electoral votes for Obama and 163 for McCain. Obama took 27 states and the District of Columbia, compared to 21 for McCain. Two states - Missouri and North Carolina - remained too close to call on Wednesday.

In Chicago, a deafening roar went out from the tens of thousands of supporters gathered in Grant Park as networks projected the Illinois senator's win late Tuesday. Supporters hugged each other and shouted out "Yes we can! Yes we can!"

"I never thought I would see this in my lifetime," said Jessica Rose, a 26-year-old African American woman from Chicago. "It's all like a fairy tale, it really is."

Obama said he recognized the "enormity" of challenges that would face him upon entering the White House. He reached out to McCain supporters with a promise to unite the country and offered a stark warning to US adversaries.

"To those Americans whose support I have yet to earn: I may not have won your vote tonight, but I hear your voices. I need your help. I will be your president too," Obama said.

Democrats had worked on the hope that eight years of Bush's unpopular policies in Iraq and the slumping economy would convince voters to hand them control of the White House and strengthen their control of Congress.

The Democrats picked up at least four seats from Republicans in the Senate and were poised to make significant gains to widen their majorities in both congressional houses. At least 15 seats in the House of Representatives had swung to Democrats by Wednesday with a number of races still outstanding.

The faltering US economy was by far the top concern of voters heading to the polls in Tuesday's general election, according to initial exit polls reported by US broadcaster CNN that showed a full 62 per cent voters ranked it as the key issue.

Millions of voters waited patiently in serpentine queues early Tuesday to cast ballots. Many had started lining up before dawn, and some braved pouring rain to cast their ballots.

It was a bittersweet end to the 21-month campaign for Obama, whose grandmother, Madelyn Dunham, 86, passed away overnight Sunday after a battle with cancer.

"While she's no longer with us, I know my grandmother is watching, along with the family that made me who I am," Obama said. (dpa)