"We face huge challenges in Afghanistan," he acknowledged before an audience of military veterans. "But it's important that the American people know that we are making progress and we're focused on goals that are clear and achievable."

The Afghan war has become increasingly unpopular amid a rising US death toll and a lack of confidence in Afghan President Hamid Karzai.

July was the deadliest month for US troops in Afghanistan since the conflict began in 2001, with 66 deaths.

In December, Obama ordered 30,000 more soldiers to Afghanistan to battle a resurgent Taliban militia, but pledged that US troops would begin withdrawing beginning in July 2011.

"On the military front, nearly all the additional forces that I ordered to Afghanistan are now in place," Obama told the national convention of the Disabled American Veterans, meeting in the southern city of Atlanta.

"Along with our Afghan and international partners, we're going on the offensive against the Taliban -- targeting their leaders, challenging them in regions where they'd had free reign, and training Afghan National Security Forces.

"On the civilian front, we're insisting on greater accountability, and the Afghan government has taken concrete steps to foster development; to combat corruption; and to put forward a reintegration plan that allows Afghans to lay down their arms," Obama said.

In Pakistan, he added, "we've seen the government begin to take the fight to violent extremists within its borders. Major blows have been struck against Al-Qaeda and its leadership."

The US-led invasion of Afghanistan, which followed the September 11, 2001 attacks in the United States, ousted the Taliban regime from power and scattered Osama Bin Laden and members of his Al-Qaeda network.

But in almost nine years later, a Taliban insurgency has become increasingly emboldened despite the presence now of almost 150,000 NATO and US troops.

"Let us never forget," Obama told the veterans, "it was Afghanistan where Al-Qaeda plotted and trained to murder 3,000 innocent people on 9/11. It is Afghanistan and the tribal regions of Pakistan where terrorists have launched other attacks against us and our allies."

If Afghanistan "were to be engulfed by an even wide insurgency, Al-Qaeda and its terrorist affiliates would have even more space to plan their next attack. And as president of the United States, I refuse to let that happen," he said.

Defending the US war effort, Obama told CBS's "Early Show" on Sunday that Washington's goals were "fairly modest" and that there were no plans to turn Afghanistan into a Western-style democracy.

"What we're looking to do is difficult, very difficult, but it's a fairly modest goal, which is, don't allow terrorists to operate from this region," he said.

"That can be accomplished," he added. "We can stabilize Afghanistan sufficiently and we can get enough cooperation from Pakistan that we are not magnifying the threat against the homeland."

Defense Secretary Robert Gates on Sunday also cautioned that large numbers of US troops will remain even after the "limited" July 2011 drawdown.

"I think we need to reemphasize the message that we are not leaving Afghanistan in July of 2011," Gates told ABC's "This Week" on Sunday.

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