In accepting the nomination, Clinton told Obama, "Thank you for this honor." She echoed Obama's theme that "America cannot solve these crises without the world, and the world cannot solve these crises without America."
She ended her comments by turning to Obama and telling him, "May God bless you."
At the close of the news conference, Obama put his arm around Clinton, and she put her arm around him, and they walked out of the room together.
A source close to Clinton said that after the primaries and while she campaigned for Obama, the bitterness of their rivalry diminished.
"She has really warmed to him. They have really warmed to each other," the source told ABCNews.com.
Clinton became a candidate for the State Department during the fall presidential race. "I think there were hints dropped along the way when she campaigned for him. ... And then there was her speech at the convention, her commitment campaigning for him that led to the offer," the Clinton source said.
Clinton, the source contended, would have little trouble advocating for Obama's positions, despite their past differences.
"Listen, they are both lawyers by training and she will represent his interests and the interests of the United States of America. There can come a time in all relationships were there are problems, but I think they are OK now," the source told ABC News.
In introducing Gates, Obama said, "I will be giving Secretary Gates and our military a new mission as soon as I take office: responsibly ending the war in Iraq through a successful transition to Iraqi control."
Obama also indicated that he would act on his campaign promise to boost troop levels in Afghanistan, where the Taliban has been steadily growing stronger.
"As Bob [Gates] said not too long ago, Afghanistan is where the war on terror began, and it is where it must end," Obama said.
Despite the apparent differences in the Obama national security team, there is also a streak of pragmatism.
Gates is known for being results oriented, nonideological and a low-key conciliator.
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