The president will focus on cementing his legacy rather than unveiling new policies, officials have said.
Mr Obama is expected to frame some of the key issues in a way that fellow Democrats can embrace during campaigning for the upcoming election.
However, recent polls suggest that seven in 10 people in the US do not share their leader's optimism.
A response by the Republican party will be delivered by South Carolina Governor Nikki Haley.
In excepts from the speech released in advance, Mr Obama urges Americans to make world changes work for them and overcome fears.