After spending most of the summer stagnant, prices posted the largest increase since June 2009.
On a 12-month basis prices rose 1.7 percent, which is less than the 2 percent target the Federal Reserve has set as a red flag indicating prices are rising too fast.
Still, to put the recent movement in perspective, prices were unchanged in three of the four previous months and down 0.3 percent in May.
The Fed also keeps a close eye on price movement with food and energy items excluded.
Core prices, as they are called, rose 1.9 percent in August.
The department said 80 percent of the overall increase was accounted for by gasoline, which rose 9 percent, while the food index rose 0.2 percent with major food group indexes mixed.
While pushed by one item, gasoline, prices increased in several other categories, including shelter, medical care, personal care, new vehicles and recreation.
Prices declined for used cars, clothing, household furnishings and airline fares.