The index rose 0.3 percent, following a 1 percent gain in September and a 0.6 percent gain in August, the Conference Board said.
The upward swing started in April following a 20-month downturn that was the longest slide since the mid 1970s.
"The data indicates that economic recovery is finally setting in. We can expect slow growth through the first half of 2010. The pace of growth, however, will depend critically on how much demand picks up, and how soon," said Conference Board economist Ken Goldstein.
The Conference Board's lagging economic indicators fell 0.2 percent in October, while the coincident index, measuring current economic conditions, was unchanged in the month.
"The composite indexes suggest the recovery is unfolding and economic activity should continue improving in the near term," said Conference Board economist Ataman Ozyildirim in a statement.