The first family attended church services and visited with military families in Hawaii as they celebrated Christmas Day.
The White House said the president made holiday phone calls to U.S. service members on Christmas Eve before sitting down to dinner with his family.
The Obamas gathered to open their gifts at 8 a.m. Christmas morning before eating breakfast and singing carols. They also attended a church service at the Marine Corps Base Kaneohe Bay chapel.
The Obamas have enjoyed a low-key Christmas vacation since the president touched down on Friday after a prolonged fight with Congress over the payroll tax cut. They are spending the holidays with friends from Hawaii and Chicago as well as with the president's sister, Maya Soetoro-Ng.
In Washington, Vice President Biden and his wife, Jill, visited with wounded service members at Walter Reed National Military Medical Center.
The first family will end their Christmas with a family dinner at their vacation home and are expected to return to Washington after New Year's Day.
The president's family was already in Hawaii but Obama's trip was delayed until Friday as House Republicans initially rejected a Senate-passed payroll tax cut extension. Obama had urged lawmakers to stay in town until their work was finished.
But on Thursday, the House GOP capitulated after pressure from Senate Republicans and amid signs they were losing the debate in the public eye. The president left for Hawaii shortly after signing a two-month tax cut break.
—This story was first posted at 5:50 p.m. and has been updated.