"All sides must listen to the wise counsel of their neighbours, commit to dialogue and take immediate steps to urge calm and support reconciliation.
"South Sudan's leaders must recognise that compromise with one's political enemy is difficult; but recovering from unchecked violence and unleashed hatred will prove much harder."
On Tuesday, the United States ordered all non-emergency embassy staff to leave South Sudan and stressed that the onus to end the violence was on the country's leaders.
The US mission in the capital Juba also has suspended normal operations for the time being.
In an example of the danger facing foreign troops in the volatile country, three Indian peacekeepers were killed Thursday in an attack by ethnic Nuer youths on a United Nations base in Jonglei state.
Other casualties are feared.
Recalling the promise and hopes that accompanied South Sudan's entrance into the community of nations just two years ago and Juba's progress in mitigating violence, Obama warned that "today, that future is at risk."
"South Sudan stands at the precipice," the president said, promising that the United States would remain a "steady partner" of the fledgling nation.
"South Sudan has a choice," he continued. "Its leaders can end the violence and work to resolve tensions peacefully and democratically."
The US leader said "too much blood has been spilled and too many lives have been lost to allow South Sudan's moment of hope and opportunity to slip from its grasp."
He urged South Sudan's rulers "to show courage and leadership, to reaffirm their commitment to peace, to unity and to a better future for their people."
- AFP