It was the eighth consecutive month when the core inflation rate, which excludes volatile fresh food prices, had shown an increase, the Ministry of Internal Affairs and Communications said.
The January increase was pushed largely by higher prices of energy and home appliances, and came on top of a similar 1.3 percent year-on-year increase in December, the data showed.
For all of 2013, the core CPI rose 0.4 percent year-on-year, the first such increase since 2008.
The rising inflation is part of the government's effort to the lift the world's third largest economy out of 15 years of deflation, or falling prices.
In their anti-deflation fight, Prime Minister Shinzo Abe's government and Japan's central bank have introduced a number of stimulus measures. Among them is the target to double inflation to 2 percent by 2015.
Japan's high energy imports costs are as a result of a lower yen. Currency depreciation makes exports less expensive but also makes imports costlier.
There remains concern, however, that the improving inflation climate could be affected by the domestic sales tax hike, scheduled to go up to 8 percent from April from the current 5 percent. A higher tax could discourage consumer spending and thus impact prices from rising further.
In other data, Japan's retail sales grew 4.4 percent year-on-year in January, while January industrial output was up 4 percent. January jobless rate stayed unchanged at 3.7 percent.