White House Press Secretary Josh Earnest said Obama vetoed the bill yesterday that would have approved the controversial pipeline almost as soon as it arrived at his office, "without any drama or fanfare or delay".
Meanwhile, environmentalists claimed victory, with Environment America's Anna Aurillo saying "the pen was mightier than the pipeline".
The pipeline - which will transport 830,000 barrels a day from Canada from Canada and Bakken shale fields in North Dakota and Montana to an existing network in Nebraska's Steele City which is connected to pipelines feeding the Gulf Coast - not only split Congress along party lines but even Democratic constituencies.
"The presidential power to veto legislation is one I take seriously," Obama said in his veto message to the Senate.
"But I also take seriously my responsibility to the American people. And because this act of Congress conflicts with established executive branch procedures and cuts short thorough consideration of issues that could bear on our national interest — including our security, safety, and environment — it has earned my veto."
Senate House Speaker, Republican John Boehner, said Obama's rejection was an embarrassment to for the nation.
"It's embarrassing when Russia and China are ploughing ahead on two massive pipelines and we can't get this one no-brainer of a project off the ground," he said.
"The president is just too close to environmental extremists to stand up for America's workers. He's too invested in Left-fringe politics to do what presidents are called on to do, and that's put the national interest first. "
His Republican colleagues have vowed to hold votes in both chambers to override Obama's veto - a heavy lift, requiring two-thirds of each of the House and Senate.
Keystone operator TransCanada's CEO Russ Girling said a world without the pipeline would, ironically, increase greenhouse gas emissions.
"Without Keystone XL, US refineries are forced to use other methods of transportation to get the oil they need for creating products we all rely on every day," he said.
"This means higher greenhouse gas emissions and relying on methods of transportation that are not as safe or as efficient as pipelines."
This statement also reflected views put forward by the US Department of State.
He said that while groups opposed to the pipeline may try to claim a symbolic victory, the reality is that without it the US would "continue to send billions of dollars overseas to regimes that are fundamentally opposed to American values, when the oil that is needed can be sourced right here in North America".
The American Petroleum Institute was naturally vexed by Obama's veto, saying the White House effectively "vetoed jobs and US energy security".
"We urge President Obama to look at his administration's State Department review of KXL and see that the facts and the science back approval of this pipeline," API president and CEO Jack Gerard said.
"We agree with his commentary on bipartisan cooperation and the need to move forward on critical infrastructure projects, and the importance of securing an American economy that supports the middle class. But instead of saying yes to 42,000 good paying jobs and enhanced North American energy security, this veto proved once again that it's politics as usual here in Washington.
"Instead of standing with 72% of Americans, including a majority of Democrats, who support the pipeline, this decision continues us down the path of indecision and delay. Voters spoke loud and clear last fall, saying they wanted Washington to work together. Unfortunately, the veto today demonstrates some are not listening."
The Consumer Energy Alliance was also disappointed, accusing Obama of hypocrisy considering he announced last May the launch of a federal permitting centre to cut bureaucratic red tape from stalling good infrastructure projects and "put folks back to work rebuilding America".
"There is no project that needs to be freed from bureaucratic red tape more than Keystone XL," CEA executive vice president Michael Whatley said.
