The 16 individuals that will be given America's highest civilian honor were chosen because they have "changed the world for the better" and set "a standard to which we all should strive," he said.
"These outstanding men and women represent an incredible diversity of backgrounds," Mr. Obama said, in a statement released by the White House. "Each saw an imperfect world and set about improving it, often overcoming great obstacles along the way."
Among those being honored are pop culture icons: The recently biopic-ed Harvey Milk, tennis star Billie Jean King and African American actor Sidney Poitier.
Woman who have broken "glass ceilings" are also being honored by the president, among them the first female Supreme Court justice, Sandra Day O'Connor, and the first female president of Ireland, Mary Robinson.
Notables who strove for change in the health care sector are also recipients at a time when the administration is pushing reform of health care. These include Senator Edward Kennedy, Nancy Goodman Brinker, and Pedro José Greer.
Senator Kennedy said that he is "profoundly grateful" that he received the Medal of Honor.
"My life has been committed to the ideal of public service which President Kennedy wanted the Medal of Freedom to represent," Kennedy said. "To receive it from another President who prizes that same ideal of service and inspires so many to serve is a great privilege that moves me deeply."
Among the honorees are leading human rights activists, among them civil rights leader Reverend Joseph Lowery and anti-apartheid activist Archbishop Desmond Tutu.
Here is the full list of recipients:
Nancy Goodman Brinker Founder of Susan G. Komen for the Cure.
Pedro José Greer, Jr. Founder of the Camillus Health Concern, St. John Bosco Clinic
Stephen Hawking Noted theoretical physicist
Jack Kemp Professional Football Player, Republican Vice President Nominee in 1996
Senator Edward Kennedy Leading congressional health care reform advocate
Billie Jean King Acclaimed professional tennis player
Reverend Joseph Lowery Civil rights movement leader
Dr. Joseph Medicine Crow Last living Plains Indian war chief
Harvey Milk First openly gay elected official, LGBT rights activist
Sandra Day O'Connor First female U.S. Supreme Court justice
Sidney Poitier First African-American to win a Best Actor Academy Award
Chita Rivera First Hispanic recipient of Kennedy Center Honor
Mary Robinson First female President of Ireland
Janet Davidson Rowley Distinguished American human geneticist
Desmond Tutu Leading anti-apartheid activist, Nobel Peace Prize recipient
Muhammad Yunus Anti-poverty leader, Nobel Peace Prize recipient