He told his final news conference that “justice has been served”.
Manning was sentenced to 35 years for leaking diplomatic cables to the group, one of the largest breaches of classified material in US history.
The commutation of her sentence has been attacked by Republicans as sending the wrong message.
House Speaker Paul Ryan said the move set a “dangerous precedent”.
The 29-year-old transgender US Army private, born Bradley Manning, leaked documents to Wikileaks in 2010.
She will be freed on 17 May but had been scheduled to be released in 2045.
The president said Manning has served a tough prison sentence.
“So the notion that the average person who was thinking about disclosing vital, classified information would think that it goes unpunished – I don’t think they would get that impression from the sentence that Chelsea Manning has served.”
The commutation announced on Tuesday reduces Manning’s sentence but is not a pardon, which some campaigners had called for.
Senator John McCain, chairman of the Senate Armed Services Committee, called it a “grave mistake” because Manning endangered lives.
“Her prison sentence may end in a few months’ time, but her dishonour will last forever,” he said.
Mr Ryan said President Obama “now leaves in place a dangerous precedent that those who compromise our national security won’t be held accountable for their crimes”.
White House press secretary Josh Earnest hit back at Republican criticism, suggesting the party was being hypocritical given President-elect Donald Trump has praised Wikileaks.
The group released hacked Democratic Party emails during the election campaign.
“It is outrageous for them to suggest that right now what Chelsea Manning did is worse than what the man who they endorsed for president did,” he told CBS News.
He also told CNN that Mr Obama believed Manning had served an “appropriate punishment”, having been jailed for nearly seven years.