The issue is sensitive to Las Vegas because its economy is largely based on tourism, and several lawmakers said they were shocked that Obama singled out Las Vegas again after commenting one year ago about bailed-out banks holding meetings here.
"When times are tough, you tighten your belts," Obama said, according to a White House transcript of his appearance Tuesday at a high school in North Nashua, New Hampshire.
"You don't go buying a boat when you can barely pay your mortgage," Obama said. "You don't blow a bunch of cash on Vegas when you're trying to save for college. You prioritize. You make tough choices."
The comments quickly sparked a flurry of reaction from federal, state and local lawmakers in Nevada, which had an unemployment rate of 13 percent in December.
"I'll do everything I can to give him the boot," Las Vegas Mayor Oscar Goodman said during a hastily called news conference, adding that he was incensed when he heard about the comments and said he would no longer welcome the president here if he visits.
"This president is a real slow learner," said Goodman, who is not affiliated with a political party.
"Enough is enough!" Democratic Congresswoman Shelley Berkley said in a statement. "President Obama needs to stop picking on Las Vegas and he needs to let Americans decide for themselves how and where to spend their hard earned vacation dollars."
Nevada's economy has been hit hard with foreclosures, unemployment and bankruptcies during the past two years as consumers everywhere tighten leisure spending and companies spend less on meetings and conventions.
Harry Reid, the Democratic Senate majority leader and one of Obama's closest allies, issued a statement headlined "Reid to Obama: 'Lay off Las Vegas,"' and was unusually blunt in his reaction.
"The President needs to lay off Las Vegas and stop making it the poster child for where people shouldn't be spending their money," Reid said.
"To truly re-energize our economy, we need people to travel to Las Vegas," Reid said. "I would much rather tourists and business travelers spend their money in Las Vegas than spend it overseas."
Reid later released a letter he received from Obama in which the president said he "wasn't saying anything negative about Las Vegas."
"I was making the simple point that families use vacation dollars, not college tuition money, to have fun," Obama said, according to the letter. "There is no place better to have fun than Vegas, one of our country's great destinations."
Obama said he always enjoys his visits to Las Vegas.
A White House spokesman referred to Obama's letter to Reid and said the administration had no further comment.
Sen. John Ensign, a Republican, complained that Obama "failed to grasp the weight that his words carry."
"Once again he has threatened the struggling economy of Las Vegas," Ensign said, recalling what he characterized as Obama's "irresponsible" comment in February 2009.
Nevada Gov. Jim Gibbons and Rep. Dean Heller, both Republicans, and Democratic Rep. Dina Titus also disparaged the president's remarks, while Republican candidates hoping to unseat Reid this year called for an apology.
One year ago, Obama commented during a town hall meeting in the state of Indiana, that corporations shouldn't use federal bailout money for trips to Las Vegas, the Super Bowl or corporate jets. Tourism and casino officials said the comment hurt the city as companies canceled meetings in Las Vegas and rescheduled them elsewhere.
Obama later said during a May 2009 trip to Nellis Air Force Base outside of Las Vegas that it was nice to get out of Washington and "there's nothing like a quick trip to Vegas in the middle of the week."
Goodman said he thought Obama had a "psychological hang-up" of using Las Vegas as an example of excessive spending, and that this time, an apology wouldn't be enough.
"He has to step up right away and say, you know, he wasn't thinking," Goodman said. "Sometimes when he's not using his monitors and reading what he says, he doesn't think. And this is one of those times he didn't think, and he should straighten out the record because he's been here, he knows Las Vegas is a great place."