Bush made these comments at an Iftar dinner hosted in the White House on Monday, an event attended by Secretary of State Condoleezza Rice, Iman Eid from the Islamic Institute of Boston as well as Ambassadors and members of the Diplomatic Corps.
The US President also took the opportunity to praise a Pakistani American Farooq Muhammad who was at the World Trade Center when the towers came crashing in the terrror attacks of September 11, 2001 and had volunteered at the time of the devastating quake in Pakistan in 2005.
"The United States also appreciates that many Muslim nations who stand with us in the war on terror... the majority of the victims of the terrorists have been innocent Muslims, and many of you have seen terrorist violence in your own cities and your streets.
"We welcome you here. We are proud to work with you to defeat the terrorists and extremists, and help bring a brighter future to millions of Muslim people throughout the world who yearn for moderation and peace," he said.
Bush said Islam is a religion that brings hope and comfort to more than a billion people around the world. It has transcended racial and ethnic divisions. It has given birth to a rich culture of learning and literature and science.
"America is a land of many faiths, and we welcome and honor the Muslim faith in our nation. Our society is enriched by our Muslim citizens."