"What is important is that we understand exactly the challenges facing us in order to defeat [Republican Sen. John] McCain," Clinton said, although she did say she also thought Obama could win in the fall.
But Obama pushed back with vigor, saying voters care more about a candidate who can improve their lives. He also complained about minor missteps dominating too much of the race.
"I think what's important is to make sure that we don't get so obsessed with gaffes that we lose sight of the fact that this is a defining moment in our history," Obama said. "We are going to be tackling some of the biggest issues that any president has dealt with in the last 40 years."
The 90-minute debate, broadcast by ABC News, was the first in two months.
The candidates are locked in an increasingly tight battle - this week's Daily News/Franklin & Marshall poll showed Clinton leading in Pennsylvania by just 6 points.
Gaffe-obsession dominated the early part of the debate as Obama took a lot of heat, fielding questions about his former Chicago pastor, Rev. Jeremiah Wright; about his recent statements about small-town Americans' being "bitter," and about why he doesn't wear an American flag pin.
More than once Obama said he thought small things get overhyped along the trail.
On the flag pin, he noted, "This is the kind of manufactured issue that our politics has become obsessed with and, once again, distracts us from what should be my job when I'm commander in chief, which is going to be figuring out how we get our troops out of Iraq and how we actually make our economy better for the American people."
One issue raised last night, which hasn't been covered much by the mainstream press, was Obama's relationship with 1960s radical Bill Ayers, a member of the Weather Underground, a radical group that claimed responsibility for a dozen bombings between 1970 and 1974.
