US President George W Bush has praised the people of Louisiana and Mississippi, two years after the states were devastated by Hurricane Katrina.
"Better days are ahead," the president told an audience at a New Orleans school flooded in 2005, before heading to Bay St Louis, Mississippi.
In the wake of the storm Mr Bush vowed to "do what it takes" to rebuild the city, but he has since faced criticism.
Katrina killed 1,600 people in the states of Louisiana and Mississippi.
The storm made landfall as a strong Category Three hurricane at 0610 on 29 August 2005 and flooded some 80% of the city after levees broke under the pressure of the storm.
In New Orleans, Mr Bush observed a moment of silence at the Dr Martin Luther King Charter School for Math and Science, the first school to reopen in New Orleans' Lower Ninth Ward, one of the areas most affected by the flooding.
"Hurricane Katrina broke the levees, it broke a lot of hearts, it destroyed buildings, but it didn't affect the spirit of this community," he said in a speech after the ceremony.
Mr Bush listed federal government moves to get the ravaged city back on its feet, including the $114bn (£57bn) allocated for the relief and rebuilding efforts.
He spoke of plans to redesign the city's levee system to provide "100-year flood defences" by 2012, adding: "New Orleans cannot rebuild until there is confidence in the levees."
There are plans to regenerate wetlands along the Mississippi delta which can help reduce the impact of future storms, the president said, and to install a $1.3bn drainage system in New Orleans.
Elsewhere, city Mayor Ray Nagin marked the moment the levees broke at a bell-ringing ceremony.
At the city's Charity Hospital a groundbreaking ceremony was held for a victims' memorial and a mausoleum to house the remains of more than 100 unidentified victims.
A candlelit vigil was due to be held in Jackson Square at dusk.
In Mississippi, the president visited what he referred to as "Ground Zero" - the site where the worst of the storm hit - in the shadow of a major highway bridge ripped apart by the hurricane.
Large areas of New Orleans have not yet been repaired
He praised Mississippi, which he said had reopened virtually every public school and moved 31,000 families out of temporary housing into permanent homes.
But the trip to both states highlighted lingering discontents over the federal government has handled reconstruction.
In New Orleans, the Bush administration was widely criticised by local residents who felt abandoned in the immediate aftermath of the disaster.
And there is still resentment at the slow pace of reconstruction, with protests planned in the city.
The front page of the local Times-Picayune newspaper on Wednesday carried a leader article alleging that Louisiana has received disproportionate federal aid funding in comparison with Mississippi.
"People are angry, and they want to send a message to politicians that they want them to do more and do it faster," Rev Marshall Truehill, a Baptist pastor, told the Associated Press news agency.