Mr Bush was speaking at the end of a two-day summit in Cancun with Mexican President Vicente Fox and Canada’s Prime Minister, Stephen Harper.
He also spoke of new technology and closer cooperation to help increase border security between the neighbours.
More than half of the illegal immigrants in the US are from Mexico.
Hardline conservatives are strongly opposed to legalising undocumented immigrants and want to criminalise them.
Mr Bush made it clear that he was not in favour of allowing illegals to be put on a fast track to US citizenship.
But he called for a dignified debate on the issue, “in recognition that America is a land of immigrants and people ought to be treated with respect”.
He also said a guest-worker programme would allow workers to do the jobs Americans did not want to do.
However, he refused to say whether he would veto a bill by hardline conservatives that would criminalise illegal immigrants.
Source: BBC News
