Johnson announced his intention to become the nominee of the Libertarian Party, seeking to capitalize on massive voter frustration with both the White House and Congress at a time of intensely polarized American politics.
"Never before has there been such an outcry over the two-party system in this country," Johnson told supporters in New Mexico, where he served two terms as a popular Republican governor.
Until this month he had been running for the Republican nod to take on Obama next November, but his polling numbers barely got off the ground and he was barred from participating in debates between the major candidates.
"Frankly, I have been deeply disappointed by the treatment I received in the Republican nomination process," he said in an email to supporters. "I had hoped to lay out a real libertarian message on all the issues in the Republican contest. The process was not fair and open.
"This election is about issues larger than party or personal ambition. The future of our country is at stake," he said. "I believe this election needs a true libertarian voice."
Johnson is seen as having no realistic chance of winning the presidency, but polls suggest a third-party candidate could siphon enough support from the eventual Republican challenger to help Obama score another term.
This is bad news for former Massachusetts governor Mitt Romney and former House of Representatives speaker Newt Gingrich, the two men who lead the field going into the first Republican voting contest in Iowa on January 3.
The combination of Johnson's name recognition with record low approval ratings for a hyper-partisan Congress could result in the most influential third-party run since Ralph Nader upended the race in 2000 as a spoiler.
But while the left-leaning Nader that year helped George W. Bush edge Al Gore in Florida -- and, ultimately, the nation -- by depriving Gore of thousands of crucial potential votes, a Johnson campaign under the right-leaning Libertarian banner could hurt Republicans.
Johnson said he was both "fiscally conservative and socially liberal," a dual position that he believes "resonates with most Americans -- and it's an agenda that's not being addressed by either political party."
The Democratic Party, he said, had "turned its back" on gay rights and the legalization of marijuana, while Republicans had abandoned their role as "stewards of the pocketbook" to promote wasteful government spending.
Johnson, who turns 59 on January 1, pledged to balance the federal budget, support both abortion and gun rights, reduce taxes and regulation, make immigration easier for people who want to work and reform drug laws.
"Let's reduce welfare in this country. Let's reduce warfare in this country," Johnson told supporters as he sought to stake out the center-ground.
"Let's have a constitutional adherence to gay rights," he said. "Let's have a constitutional adherence to gun rights."
Johnson boasts of vetoing legislation more than 750 times as governor, and is a sharp critic of the US war on illegal drugs. He's climbed four of the highest peaks on all seven continents, including Mount Everest.
Johnson endorsed staunch libertarian Ron Paul for the Republican nomination in 2008 and, coincidentally, it is Paul who is leading the opinion polls in Iowa, albeit by a slim margin from national frontrunner Romney.
"This feels good," Johnson said as he signed voter registration papers after his announcement.
"The Libertarian nominee for president will be on the ballot in all 50 states, something that is very, very significant."
US politics is largely a two-party affair, but there have been some key independents and third-party candidates.
Business tycoon Ross Perot played a contentious role in the 1992 presidential race running as an independent, garnering nearly 19 percent of the popular vote in a race in which Republican president George H.W. Bush lost to Democratic challenger Bill Clinton.
Real estate mogul and reality TV personality Donald Trump, who this year flirted with a presidential campaign as a Republican, reportedly quit the party to register this month as an independent, opening the way for his own potential outsider run.
