Jan. 4 (Bloomberg) -- Barack Obama's campaign is ``fired up, ready to go,'' to quote a favorite chant, as he heads into New Hampshire's Jan. 8 presidential primary with a big victory over front-runner Hillary Clinton in the Iowa caucuses.

A record outpouring of Democratic voters gave Obama a victory last night with 38 percent support, while John Edwards, with 29.8 percent, barely edged out Clinton, who finished third at 29.5 percent.

The Illinois senator's victory in the nation's first nominating contest will boost his effort to capture the independent voters who play an outsized role in New Hampshire. Almost twice as many people turned out to vote in Iowa as four years ago, showing an appetite for change, Obama advisers said.

``Obama will get the lion's share of independents,'' predicted George Bruno, a former New Hampshire Democratic Party chairman and an adviser to Bill Richardson, who finished fourth in Iowa. Obama ``really sold himself as the candidate of change,'' Bruno said.

Obama this morning told a rally of more than 500 people in an airport hangar in Portsmouth, New Hampshire, that a win in the state's primary next week could help propel him to the presidency.

``Four days from now, New Hampshire, you have the chance to change America,'' Obama said.

Big Disappointment

The results are a big disappointment for New York Senator Clinton, 60, who had been counting on a win to cement her standing as the party's presumptive nominee and to stave off Obama's rise in recent polls.

The loss also is hard on Edwards, 54, a former North Carolina senator, who had been campaigning in the state since the last election.

``Mr. Edwards lived in Iowa for the last four years,'' said Democratic strategist Glenn Totten, who isn't affiliated with a campaign. ``He was the one who was counting on a victory.''

Obama's win amounts to a rebuttal of Clinton's argument that voters wouldn't trust the presidency to a first-term senator with little formal national experience. The victory in mostly rural, white Iowa also represented a historic moment for the U.S. and Obama, who is vying to become the nation's first black president.

``You have done what the cynics said we couldn't do,'' Obama told cheering supporters yesterday. ``You have done what the state of New Hampshire can do in five days.''

Participation

The number of Democrats participating in the caucuses jumped to almost 240,000, close to double the 124,181 who voted in 2004.

Edwards and Clinton both vowed to fight on. ``I am so ready for the rest of this campaign, and I am so ready to lead,'' Clinton told supporters in Des Moines.

``The one thing that's clear from the results in Iowa tonight is that the status quo lost and change won,'' Edwards told his own supporters. ``Now we move on from Iowa to New Hampshire and the other states to determine who is best suited to bring about the change that this country so desperately needed.''

In New Hampshire, the candidates must woo independents, who represent about 40 percent of the state's voters and can ask for either a Republican or Democratic ballot. Historically, they have participated in the primary where ``they can have their voices heard,'' said New Hampshire Secretary of State Bill Gardner.

Clinton's Lead

The lead Clinton has maintained in New Hampshire for most of the year has recently been shrinking. A CNN/WMUR poll conducted Dec. 27-30 showed Clinton at 34 percent, Obama at 30 percent and Edwards at 17 percent.

Those numbers may shift as a result of Clinton's Iowa showing, said Steffen Schmidt, a political science professor at Iowa State University in Ames. ``This is a dark cloud over her campaign,'' Schmidt said.

At the same time, Clinton has led among her party's core supporters in New Hampshire. She can also draw upon the popularity of her husband, Bill, and his political knowledge of the state where his strong second-place finish in the 1992 primary prompted him to call himself the ``Comeback Kid'' and helped propel him to the presidency.

Clinton's campaign chairman, Terry McAuliffe, said the campaign has paid for advertising through Feb. 5. ``She's going to have to fight for this nomination and she knows that,'' he said aboard a plane going from Iowa to New Hampshire today.

Rally in New Hampshire

Clinton held a rally this morning at an airplane hangar in Nashua, New Hampshire, asking audience members what questions they needed answered to make their decision next week and emphasizing her experience and electability.

``I've been through the fires,'' she said. ``I have a broad and deep-based support from people in so-called red states.''

Obama has the endorsement of the state's two freshmen members of Congress, Democrats Carol Shea-Porter and Paul Hodes, whose upset victories in 2006 were fueled in large part by their opposition to the Iraq war.

Obama, who has focused on themes of change and hope, can now point to his Iowa victory to make the case that he's the most attractive candidate to voters weary of Washington politicians.

Democratic Senators Christopher Dodd of Connecticut and Joseph Biden of Delaware dropped out of the race last night after failing to get even 1 percent support each in Iowa.

Four years ago, Iowa marked a turning point for the Democrats' campaign when Massachusetts Senator John Kerry's surprise win in the caucuses gave him momentum that helped him cruise to the nomination.

The Iowa and New Hampshire contests are critical first tests in a year when most states have moved up their primaries. The candidates still in the race after New Hampshire will face primaries or caucuses in Nevada, South Carolina, Florida and Michigan before Feb. 5, when almost two-dozen states, including California, New York, New Jersey and Illinois, cast votes.

To contact the reporters on this story: Kristin Jensen in Washington at kjensen@bloomberg.net; Hans Nichols in New Hampshire at hnichols2@bloomberg.net

Last Updated: January 4, 2008 11:12 EST