Barack Obama said Congress had been given ample opportunity to come up with its own plan but had failed to act.
Republicans in Congress say such action would be beyond Barack Obama’s authority.
His remarks follow media reports he plans to extend protection from deportation, potentially affecting as many as five million immigrants.
At a news briefing during a visit to Myanmar, Barack Obama said he had given the House of Representatives more than a year to come up with an immigration bill but they had failed to do so.
The Senate passed a far-reaching immigration bill in 2013, but the House has not taken up the legislation.
“There has been ample opportunity for Congress to pass a bipartisan immigration bill that would strengthen our borders, improve the legal immigration system and lift millions of people out of the shadows,” he said.
“I said that if in fact Congress failed to act, I would use all the lawful authority I possess to try to make the system work better,” the president added.
“And that’s going to happen before the end of the year.”
Barack Obama added that as soon as Congress passed a bill he could sign, “any executive actions will be replaced”.
However, Republicans in Congress said the president should work with them.
“We’re going to fight the president tooth and nail if he continues down this path,” House Speaker John Boehner told reporters.
Mitch McConnell, the incoming Senate majority leader, urged the president to “work with us to try to find a way to improve our immigration system”.
Some Republicans are pushing for the budget bill to include a statement prohibiting “the use of appropriated funds for the president’s immigration machinations”.
Such a move could provoke a block by the Democrats, or a veto by the president, which in turn raises the risk of a government shutdown.
Unilateral action has been expected on immigration but details of what the president was considering were first reported this week in the New York Times and Fox News.
At the centre of the reports is a plan to extend Barack Obama’s “deferred action” plan, which was designed to protect young adults who were brought to the US illegally as children from being deported.
The plan is to include parents of children who are US citizens or legal residents.
The action is designed to prevent the break-up of families via deportations. The number of those affected by the suggested policy is based on how long an individual has lived in the US.
If the administration limits the “deferred action” to those who have lived in the US for more than 10 years, it would affect 2.5 million undocumented immigrants, experts estimate.
If the time limit is lowered to five years, it would stop deportations for as many as 3.3 million.
Other parts of the executive action reported by the media include: increasing the number of high-tech workers allowed to live and work in the US; an expansion of the existing deferred action plans that would move the cut-off date for children arriving to 2010; shift border security resources to the US southern border, according to reports.
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