Today marks a century since the start of the massacres waged by Ottoman forces, which Armenia says killed 1.5 million people between 1915 and 1917.
Modern Turkey, the successor state to the Ottomans, rejects the term "genocide," arguing that 300,000 to 500,000 Armenians and as many Turks died.
The deaths remain a bone of contention today between the two countries and a sensitive topic for Armenians around the world - including in the US, where local groups were outraged at Obama's choice of words.
"Amid horrific violence that saw suffering on all sides, one and a half million Armenians perished."
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He said Armenians had made valuable contributions in the countries where they settled, including the United States.
"Against this backdrop of terrible carnage, the American and Armenian peoples came together in a bond of common humanity," he said.
The White House has avoided calling the incident a genocide, though last month US lawmakers introduced a resolution urging Obama to recognise the killings as such.
Armenian Americans expressed anger over the president's latest choice of words.
"President Obama's exercise in linguistic gymnastics on the Armenian genocide is unbecoming of the standard he himself set and that of a world leader today," Bryan Ardouny, executive director of the Armenian Assembly of America, said in a statement.
"The world should know that while our president bowed to Turkish denial, Armenian Americans and other people of good conscience will never allow our history to be swept under the rug," Ardouny added.
"I have consistently stated my own view of what occurred in 1915, and my view has not changed. A full, frank, and just acknowledgement of the facts is in all our interests," he said.
"We welcome the expression of views by Pope Francis, Turkish and Armenian historians, and the many others who have sought to shed light on this dark chapter of history."
Pope Francis used the word genocide this month to describe the killings, infuriating Ankara.