He also reiterated strong support for a "guest worker" program that would allow undocumented immigrants already in the United States to remain in the country to fill low-paying jobs that Americans won't take.
However, Mr. Bush declined to say whether he would veto legislation that did not contain such a provision.
"We're making progress and I want a comprehensive bill," Mr. Bush said at a joint news conference with Mexican President Vicente Fox and Canadian Prime Minister Stephen Harper.
The three-way meeting in the Mexican resort city of Cancun came as the U.S. Congress is embroiled in an intense debate over immigration legislation.
"I expect the debate to bring dignity to America, in recognition that America is a land of immigrants," President Bush said at Friday's news conference.
But talking about the hot-button issue gave President Bush an opportunity to rekindle his relationship with Mexico's President Fox, which has been strained by Fox's opposition to the Iraq war, CBS News correspondent Jim Axelrod reports.
"I told the president we're making progress. You know, there's a legislative process," Mr. Bush said.
"With immigration on the front burner, this is probably President Bush's last best shot at getting the immigration reform through that he and Mexico's President Vicente Fox proposed five years ago, when they both were first elected," says CBS News foreign affairs analyst Pamela Falk.
"But," she adds, "as an issue with deep divisions in the U.S. and in both political parties, getting an immigration package through this Congress will take some serious negotiating."
A senior White House aide told CBS News that they don't expect any bill to cross the President's desk before Election Day, Axelrod reports.
But looking across the American southwest, the issue seems more pressing.
Severalat nearly two dozen Las Vegas area schools while hundreds more held demonstrations in several California cities, in a renewal of protests over immigration policies being debated in the U.S. Congress.
Under a heavy police presence in downtown Las Vegas, scattered groups of students totaling about 3,000 in all, chanted slogans and carried Mexican and American flags as they called for an end to anti-immigrant legislation.
At the news conference, Mr. Bush also defended a new U.S. requirement, scheduled to take effect Dec. 31, 2007, requiring all American and Canadian travelers to carry a passport when they cross into each other's country.
Harper said he had expressed Canada's concern to Mr. Bush over the new restriction.
But, Mr. Bush said, "Congress passed the law and I intend to enforce the law." He said he believes that if properly implemented the program "will facilitate travel and facilitate trade, not hinder travel and trade. I think we can be wise about the use of technologies."
The three leaders vowed to forge closer ties on trade, energy, combating common problems like the bird flu and in raising standards of living across North America.
"You can't achieve a standard of living increase for your people unless you have a prosperous neighborhood," Mr. Bush said