He is also expected to press lawmakers to reauthorize a domestic surveillance law that expires Friday.
The address comes as Bush slides increasingly into lame-duck territory, racking up miles globe-trotting around the world focusing on foreign relations, as the nation is increasingly focused on the 2008 presidential election race.
Bush and his team of three speech writers have been honing this year's State of the Union address since December.
After more than seven years in the White House, the president faces a Congress led by Democrats, and an American public who largely believe the war in Iraq was a mistake, and who are worried about the economy.
Seventy-seven percent of Americans polled believe the country is headed off on the wrong track -- the most since the government shut down in 1996, according to an ABC News/Washington Post poll released earlier this month.
A majority of Americans, 66 percent, continue to disapprove of the way Bush is handling his job, and 64 percent said the war was not worth fighting. However, by far the most press concern on the minds of Americans is the flagging economy.
During his almost eight-year presidency, Bush has forged ahead with ambitious agenda items in the State of the Union, including deep tax cuts, vast changes in federal social programs, expansions of executive power and a broad remaking of energy and education policies.
But the president's second term has been defined by an unpopular war, low approval ratings and a midterm election that ushered a slim majority of Democrats to helm Congress.
Tonight's State of the Union speech is one of the last chances Bush will have to define his eight-year presidential legacy.