On the far south side of Chicago, separated by more than 20 miles and a vast chasm in wealth from the city's soaring skyline, is a collection of squat brick buildings where Barack Obama says he found his calling.

The Altgeld Gardens public housing project reeks of decay, fear and despair. At the only shop serving its 2,000 homes, water pours in from the roof on to sodden cardboard below while a high Perspex barricade protects staff from assault and cheap merchandise from theft.

Lincoln King shuffles in with snow on his boots and Mr Obama's name stitched in big letters on his hat. He is 49 but looks a lot older as he carefully counts out his money for a six-pack of beer at ten in the morning. Did he know that the President-elect worked here in the mid-1980s? “No.” Does he care? “I don't remember him.” Will having a black President make any difference? “This place don't change much. Same old s***.”

Mr Obama says that he “grew up to be a man” and received an education at Altgeld Gardens “better than anything I got at Harvard Law School” - where he retreated after working these mean, dark streets.

Now, as he prepares to be sworn in as President, this blighted housing project may become both a symbol of the challenge and a test of his success in healing America's divisions. Mr Obama devoted more than 150 pages of his first autobiography, Dreams From My Father, to a chronicle of his efforts as a community organiser here. As the future President explored the borders of his own racial and political identity, he described how Altgeld was surrounded by “the stench, the toxins” of neighbouring sewage plants, landfill sites, polluted rivers and motorways.

Altgeld Gardens was, he said, “a dump - and a place to house poor blacks”. Almost a quarter of a century later the housing project remains much the same. “It was, it is, a tough, tough place,” he said recently.

Cheryl Johnson, who leads a local group called People for Community Recovery, says: “Obama left no real legacy behind when he went off to Harvard.” On a wall near her office, the names of hundreds of residents who have died from disease or violence have been scrawled, by way of a makeshift memorial, along with the words: “What bullet killed him. There goes another black brother.”

More are added each month, a shooting takes place most weeks and some people blame a belated refurbishment of boarded-up buildings for making matters worse by moving gang members or drug dealers into blocks occupied by the elderly.

His book details the many frustrations as he faced, for the first time, the hard realities of political power in this racially divided city. But he also claimed some small victories: bringing church groups together; securing job grants; trying to improve playgrounds and schools. His most notable success was discovering that homes were filled with asbestos and then leading a campaign for its removal by taking a busload of residents downtown to challenge housing authority officials.

That moment changed him “because it hints at what might be possible and therefore spurs you on”, he wrote. “That bus ride kept me going, I think. Maybe it still does.”

Back in Altgeld, Ms Johnson claims that this account is exaggerated and fails to mention how her mother had been fighting against asbestos long before a young community organiser known then as “Baby Face” came on board. “I like Obama but he is taking the credit for what my Mom did,” she says. “That's what politicians do.”

Others, however, say that he was an effective organiser who built up a network of people ready to take control of their own lives. Jerry Kellman, who first hired him on $1,000 a month to work for the Developing Communities Project, says that Mr Obama spotted that the housing authority was removing asbestos from its offices before tackling the problem inside homes. “He saw it as an issue of fairness and without him there would have been no real campaign.”

Mr Obama acknowledges that his work as an organiser had limited success. “When I left to go to law school,” he said a few years later, “I couldn't tell whether I had gotten more out of this than the people I was working with.” Mr Kellman, whose name was changed to Marty Kaufman to protect his privacy in Dreams from My Father, also believes that Altgeld left more of a mark on Mr Obama than he did on it. “Chicago toughened him up. Barack was very idealistic when I first knew him,” he says.

“We taught him not to be naive in thinking that just because someone has been elected to public office they are motivated by civic virtue. He left because he wanted to achieve change on a larger scale.”

Mr Obama learnt well. Reflecting on his time as a community organiser, he told one interviewer: “Citizens are taught that decisions are made on the public interest or grand principles when, in fact, what really moves things is money, votes and power.”

In Chicago, Mr Obama was trained in the radical activist school of Saul Alinsky, who believed that people could be agitated into action to pursue a collective self-interest. But Mr Kellman found his student balking at using some of the tactics of confrontation favoured by Alinsky. When the young Obama accused him of manipulating people for his own ends, Mr Kellman replied: “I'm not a poet, Barack. I'm an organiser.”

They also disagreed over Mr Kellman's view that racial grievances were a distraction from efforts to unite unemployed workers - black, white and Latino - behind a common cause of fighting poverty. Mr Obama, as he struggled to make sense of his multi-ethnic roots, found himself asking “whether the bonds of community could be restored” without exorcising the ghostly hatred “that haunted black dreams?” Shortly afterwards, Mr Obama joined the congregation of the Rev Jeremiah Wright.

Mr Kellman, 58, has abandoned the harder edges of community activism to become a lay Catholic minister to work on “changing hearts”, while worrying whether Mr Obama's head will be turned by all the adulation he receives. But he still suggests that his old class argument has been given fresh impetus by the election of “someone called Barack Hussein Obama” as America's first black President.

“Barack was defined by his opponents as an outsider and the people still voted for him because they now see themselves as outsiders in the system.” He thinks the making of Mr Obama as a politician came with his defeat in a primary contest eight years ago for a black Congressional seat.

This led him to stand in state-wide elections for the US Senate where he developed his signature theme of transcending racial divisions. “Barack's ability to hold differences together is his point of genius,” Mr Kellman says. Johnnie Owens, who was hired by Mr Obama to replace him at the Developing Communities Project 20 years ago, agrees that the future President used his experiences in Altgeld Gardens to “resolve some authenticity issues” about his racial identity.

In the years that have passed since, they have drifted apart and - unlike Mr Kellman - Mr Owens has neither plans nor tickets to attend the inauguration. He still works as a community activist for Chicago's Organisation of the North East and sometimes wonders if he should feel resentful that Mr Obama, having enticed him into this gritty world, crossed “over to the other side of the fence”.

“Barack is now one of those politicians he taught me to hold to account. He knows how to use the reform rhetoric but in his actions he stays in the middle politically. I haven't seen him do too much to ruffle feathers and shake things up and challenge power.

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