The grants will be used to help fight poverty, improve education and provide more affordable housing, better public transportation and safety.
A spokesman for Mayor Eric Garcetti said the city will likely transfer the funds to nonprofits and other groups involved in anti-poverty efforts in those communities.
"It's been an important priority for me that we not just recover as a city economically, but that we all recover," Garcetti said.
The Promise Zone in Los Angeles includes East Hollywood, Pico-Union/Westlake, Thai Town, Little Armenia and Koreatown.
"The White House specifically said that Los Angeles has prepared itself so well that we are the first round, first choice," Garcetti said. "I see tremendous hope and I think this is a great, great recognition of that with the Promise Zone."
The other Promise Zones announced by President Barack Obama on Thursday are in San Antonio, Philadelphia, southeastern Kentucky and the Choctaw Nation of Oklahoma. Amid a slow recovery that has not reached many at the lowest rungs of the economy, addressing poverty has become an emerging issue in Washington. Mr. Obama has made it a central part of his agenda.
"We've got to make sure this recovery - which is real - leaves nobody behind," the president said. "And that's going to be my focus throughout the year."
In a rare public reference to his own upbringing, Obama compared himself to a young man invited to the White House event Thursday who graduated from high school under a 1997 Harlem program and become the first member of his family to attend college. As described by Obama, the student, Roger Brown, was the son of a single mother and was nearly expelled from school before deciding to make a change in his life.
"There was a period of time in my life where I was goofing off," Obama said. "I was raised by a single mom, I didn't know my dad. The only difference between me and Roger was my environment was more forgiving than his. That's the only difference. If I screwed up, the consequences weren't quite as great."
The designation gives Los Angeles preferential status for up to $500 million in grants over the next decade. It will likely take at least three to six month before nonprofit organizations see any of the funds.
Thursday's announcement coincided with the 50th anniversary of President Lyndon B. Johnson's "war on poverty." It also comes a day after the Los Angeles 2020 Commission said that Los Angeles is in a downturn.
"L.A. is treading water and in serious prospect of decline," said former U.S. Commerce Secretary Mickey Kantor, who chairs the new 13-member panel.
The report, titled "A Time For Truth," says L.A. is weak in job creation, accuses leaders of budget gimmickry and criticizes public schools.
The Associated Press and City News Service contributed to this report.