"Surely, there will be difficult days to come, but the United States will continue to stand up for the rights of the Egyptian people and work with their government in pursuit of a future that is more just, more free and more hopeful," Mr. Obama said he told the long-time leader in a phone call from the White House.
The president made his comments on television shortly after he and Mubarak spoke.
The conversation followed closely on a middle-of-the-night TV speech in which Mubarak, in Cairo, announced he was sacking his government to form a new one that would accelerate reforms. At the same time, he said, violence by protesters would not be tolerated.
Mr. Obama's remarks capped a day in which his administration struggled to keep abreast of developments in Egypt, where Mubarak ordered police and then the military into the streets in response to the thousands of protesters.
Before Obama spoke, White House press secretary Robert Gibbs announced the administration might cut the $1.5 billion in annual foreign aid sent to Egypt, depending on Mubarak's response to the demonstrations.
Mr. Obama also repeated demands by Secretary of State Hillary Clinton for Egypt's government to restore access to the Internet and social media sites, cut by the authorities in an apparent attempt to limit the flow of information about the protests demanding an end to Mubarak's rule.
Mr. Obama noted the United States and Egypt have a close partnership, a reference to Mubarak's support over the years for peace with Israel.
But he said, "We've also been clear that there must be reform, political, social and economic reforms that meet the aspirations of the Egyptian people."
He added that the demonstrators had a responsibility "to express themselves peacefully. Violence and destruction will not lead to the reforms they seek."
Mr. Obama's decision to speak about the crisis in Egypt underscored the enormous U.S. interest at stake - from Israel's security to the importance of the Suez Canal and the safety of thousands of Americans who live and work in Egypt.
Earlier Friday, Secretary of State Hillary Clinton urged the Egyptian government to scale back its violent crackdown against protesters -- but she maintained that the United States wishes to maintain its partnership with the Egyptian government.
"We are deeply concerned about the use of violence by Egyptian police and security forces against protestors, and we call on the Egyptian government to do everything in its power to restrain security forces," Clinton said at a press conference Friday.
"At the same time, protesters should also refrain from violence and express themselves peacefully," she added.
Clinton said today that in order preserve Egypt's long-term stability, as well as the "progress and prosperity its people deserve," the Egyptian government must engage immediately with its citizens to implement economic, political and social reforms. She said that the United States has raised this issue with Egypt and other nations in the region repeatedly.