Outlining a reconciliation plan aimed at resolving Syria's 21-month conflict which according to the UN has claimed more than 60,000 lives, Assad called on foreign powers to end their support for rebels seeking to topple his regime.
"Regional and international countries must stop funding the armed men to allow those displaced to return to their homes," Assad said to wild applause from crowds packed into the Dar al-Assad Centre for Culture and Arts in Damascus.
"Right after that our military operations will cease," he said, adding without elaborating that a mechanism to monitor such a truce would be established.
Describing the Western-backed opposition as "slaves" of foreign powers, he admitted that Syria was in the throes of a "real war".
The government would soon spell out details of the transition plan, he said, while stressing that any resolution must be purely Syrian and ratified by referendum, including a charter drafted at the national dialogue conference.
After the referendum, new parliamentary polls would be held, followed by the creation of a new government, said Assad.
But he stressed for all this to happen "there must be agreement at the national dialogue conference."
"Just because we have not found a partner, it does not mean we are not interested in a political solution, but that we did not find a partner," he told the audience.
He said the conflict was not one between the government and the opposition but between the "nation and its enemies."
"The one thing that is sure that those who we face today are those who carry the Al-Qaeda ideology," Assad said, repeating previous assertions that "foreign terrorists" are behind the uprising in his country.
"There are those who seek to partition Syria and weaken it," he said.
Assad last spoke in public on June 3 when he addressed parliament in Damascus. In November he gave an interview to Russian television in which he dismissed suggestions he would go into exile, saying he would "live and die" in Syria.
Since then he has not commented on the conflict which has ravaged his country, with vast swathes of northern Syria now in the hands of rebels, who also control an arc of towns on the eastern outskirts of Damascus and are locked in battle for control of major cities, including Homs and Aleppo.
In his speech on Sunday Assad came out fighting, appealing to all Syrians to join together to defend the nation.
"Everyone must defend it... the attack on the entire nation... every citizen who is aware... and refusing to join solutions is taking the nation backwards," he said.
The president, who was frequently interrupted by chants of "With our soul with our blood we sacrifice ourselves for you O Bashar", stressed throughout his speech that the Syrian people must decide their future alone.
During his latest visit to Damascus, UN-Arab League peace envoy Lakhdar Brahimi had mentioned a plan, based on a Geneva declaration, that talked of a ceasefire, forming a government and holding parliamentary and presidential polls.
The Geneva plan put forward last June would see a transitional government in place, but it does not refer to Assad going -- a key demand of the opposition.
Nato-member Turkey, a one-time Damascus ally, has become one of its most vocal opponents over the conflict in its southern neighbour, and has led international calls for Assad to go.
On Saturday the deployment began of US Patriot missiles near its border with Syria.
The US will transport some 400 troops to Turkey in the coming days to operate two Patriot batteries, to be based at Gaziantep, 50 kilometres (31 miles) north of the border.
Germany, The Netherlands and the United States agreed to supply the ground-to-air missile batteries which Turkey requested after deadly cross-border shelling from Syria.
Violence on the ground continued unabated, with the Syrian Observatory for Human Rights on Sunday reporting that troops bombarded rebel positions on the outskirts of the capital overnight, including in Beit Saham near the Damascus airport road, the southwest town of Daraya and Douma to the northeast.
With the conflict spilling across Syria's borders, Israeli Prime Minister Benjamin Netanyahu said the Jewish state would erect a new security fence along the armistice line with Syria in the Golan Heights to guard against "infiltrations and terror."