"I'm told Presidents Eisenhower and Johnson actually ate their turkeys," Obama said. "You can't fault them for that; that's a good-looking bird."
President George H.W. Bush was the first to officially pardon a turkey.
Obama joked about wanting to forgo the tradition and eat Courage.
"Thanks to the interventions of Malia and Sasha -- because I was planning to eat this sucker -- Courage will also be spared this terrible and delicious fate," he said.
In response to Obama's comments that his daughters helped to save the turkey's life, the animal rights group PETA said it is giving Malia and Sasha honorary memberships in PETA Kids.
"We want to thank them for their involvement in pardoning the turkey this Thanksgiving," said PETA spokeswoman Ashley Byrne.
Obama wished all American service members at home and abroad a happy Thanksgiving, saying what a "tremendous honor it is to serve as commander in chief of the finest military in the world."
He also spoke about the first family's plans for the holiday dinner.
"Just like millions of other families across America, we'll take time to give our thanks for many blessings," Obama said. "We'll also remember this is a time when so many members of our American family are hurting."
Obama noted that President Abraham Lincoln made Thanksgiving a holiday in the midst of the Civil War, "when the future of our very union was most in doubt."
"This is an era of new perils and new hardships," he added. "So on this quintessentially American holiday, as we give thanks for what we've got, let's also give back to those who are less fortunate."
After his remarks, the turkey was lifted to a table and Obama raised his hand over its head to deliver a mock-serious pardon.
"You are hereby pardoned," he said.
Obama said Courage will spend the rest of his life in "peace and tranquility" at Disneyland.
Byrne said PETA sent Obama a letter requesting that the turkey be sent to a sanctuary instead of the theme park.