Of the nation, Obama said "we're not cured" of the "legacy of slavery," adding that it casts a long shadow. He apparently meant to be provocative when he used a racial slur.
The White House says the president is not surprised there is controversy, but doesn't regret using the N-word in a frank discussion about race on comedian Mark Maron's podcast.
"And it's not just a matter of it not being polite to say n**** in public," said Obama. "That's not the measure of whether racism still exists or not. It's not just a matter of overt discrimination. Societies don't, overnight, completely erase everything that happened 200 to 300 years prior."
At the U.S. Conference of Mayors in San Francisco, ABC7 News talked with Baltimore Mayor Stephanie Rawlings-Blake, who believes the president was making a point that's been lost in the focus on one word.
"He's talking about the very real issues of covert and overt racism and the progress that we've made, but also the fact that in some areas we have not come that far," she said.
Race issues are in the open in her city following rioting in April after the death of Freddie Gray, an unarmed black man in police custody. Now the spotlight is on Charleston, South Carolina, the scene of the horrific church shootings by a white suspect that killed nine black worshippers.
PHOTOS: 9 killed at church in South Carolina
Steve Benjamin, the mayor from Columbia, South Carolina, believes use of the N-word or any racial slur is inappropriate, but says it's important for Americans to have a dialogue about race.
"I'm glad the president is leading, even in a very provocative way, this discussion," he said.
When asked if what happened in his state could be a tipping point, Benjamin said, "I pray, I pray so. It would be a travesty for us not to use this as an opportunity to affect real meaningful change in this great country of ours."
Benjamin says he was close friends with state Senator Clementa Pinckney, one of those killed at the Charleston church.
Obama is scheduled to deliver the eulogy on Friday.
JUST IN: Pres. Obama to deliver eulogy for Rev. Clementa Pinckney on Friday in Charleston; VP Biden to also attend. pic.twitter.com/pxfAaj2oJK— ABC News (@ABC) June 22, 2015
Click here for full coverage on the Charleston church shooting.