Output in the 18-nation currency region expanded for the seventh consecutive month, Markit said with the index climbing from December's mark of 52.1 to 52.9.
Markit said the flash purchasing managers index for the service sector rose to 51.9 from 51 in December.
However, "the recovery in the service sector remained subdued in comparison" to the manufacturing sector, which set the pace in January, Markit said.
Among individual countries, Ireland topped the list with a composite PMI of 57.8 in January. Germany's composite PMI came to 55.5, while Spain's index came to 54.8, a 78-month high.
Italy's composite PMI reached a three-month high at 51.3. The index in France also reached a three-month high, but at 48.9, the measure suggests a slow business contraction, as numbers below 50 indicate contraction, while above 50 the numbers indicate expansion.
"The final reading of the eurozone PMI was down slightly on the earlier flash reading but nevertheless signals a very encouraging start to the year," said Markit Chief Economist Chris Williamson.
"Companies are reporting the strongest growth of business activity for two-and-a-half years, putting
the economy on course to grow by 0.5 percent in the first quarter if this pace is sustained," he said.