The Obamas meet Bono and Ali in Dalkey
The casually dressed couple were beaming as they met the First Family on their holidays.
Local TD Mary Mitchell O'Connor was also in attendance, as were carefully selected guests as the pub is closed to the public until tomorrow morning.
Earlier this mroning, they visited Wicklow National Park , and were given a tour of the famous site by the manager of the Glendalough Visitor Centre, George McClafferty.
They visited the Interpretative Centre where they were shown a model of the 6th century monastic village, and then taken along the Green Road to the monastic city and the iconic Round Tower.
They also were shown the Deer Stone, a flat round hollowed-out rock which, according to legend, would be visited by a doe waiting to be milked when St Kevin needed to feed two orphaned babies.
Michelle, looking relaxed, asked several questions about the rock.
"This gives great power," she remarked.
Afterwards they were driven to the scenic Upper Lake where there is a spectacular view of the Wicklow valley.
After spending about an hour exploring the site, Michelle and the girls departed for the village of Dalkey where they are believed to be meeting with one of its most famous inhabitants, Bono, before the trio travel back to Belfast to be reunited with President Obama as the G8 summit draws to a close.
Secret Service officials have been dispatched to key points around the village, including a residence on Sorrento Road. However, management at the pub refused to be drawn on the official schedule.
But locals said there was a buzz around the village, with even bins being covered and traffic cones placed along the route into the village.
Local Gillian Boland, who was there with friends Sara Robinson from France and Paul Knight from London, said that Dalkey was an obvious choice for a high-profile visitor.
“It is such a lovely, unspoilt village. It is close to the city but it is another aspect of Dublin with the mountains and the sea,” she said.
“The residents here are so cool. “Pierce Brosnan was here recently and no one paid him any notice.”
Neighbouring houses along Sorrento Road, adjacent to Finnegan's pub, had received a knock on the door from the gardai informing them not to be alarmed if they see plenty of the boys in blue lurking in the neighbourhood today.
"I'm delighted she is coming I think she is a great woman," said writer Gordon Snell, husband of the late Maeve Binchy, as he enjoyed a glass outside his local hostelry. "I think she is brilliant. It is a beautiful town, I'm sure she'll love it.
"It is one of the best pints in Dublin. As good as Moneygall or better than Moneygall," quipped Snell.
Across the road in Moll's Paraphernalia, Frank Cullinan said such a visit would be good for Finnegan's and Dalkey. "Things are usually pretty well done up," said the store owner as the hanging baskets outside the pub were checked.
"If she comes in I'll give her a discount for cash," he joked. "We've a few 'Cead Mile Failte' signs she could stick up on the door of the White House."
Mrs Obama enjoyed dinner last nnight in Matt the Thresher restaurant in Dublin.
Following lunch in Dalkey the Obamas will head north to meet President Barack Obama and travel on to Germany for the latest leg of his European meetings.