"You know, the truth is that this was an example where we had some poor phrasing in the speech. And we immediately tried to correct the interpretation that was given," he said in an interview aired on Sunday on CNN's "Fareed Zakaria - GPS."
"The point we were simply making was, is that we don't want barbed wire running through Jerusalem, similar to the way it was prior to the 67' war, that it is possible for us to create a Jerusalem that is cohesive and coherent," Obama said.
Obama's campaign has issued similar clarifications since the candidate's speech to the pro-Israel lobby group after he clinched the Democratic presidential nomination early last month.
In the speech, Obama told the American Israel Public Affairs Committee that if elected president in November, he would work for peace with a Palestinian state alongside Israel.
"Jerusalem will remain the capital of Israel, and it must remain undivided," the Illinois senator said. Palestinian leaders reacted with anger and dismay.
Israel calls the city its undivided and eternal capital, but this status has never been recognized internationally. Palestinians want east Jerusalem, captured by Israel in 1967, for a future capital.
The US Congress passed a law in 1995 describing Jerusalem as capital of Israel and saying it should not be divided, but successive presidents have used their foreign policy powers to maintain the US Embassy in Tel Aviv and to back negotiations between Israel and the Palestinians on the status of Jerusalem.
Obama, who plans a trip to the Mideast this summer, has faced wariness among some Jewish voters over his commitment to Israel, fueled by suspicion over his comments indicating willingness to talk to Iranian leaders.