Powell, appearing on NBC's "Meet the Press," said Obama, a U.S. senator from Illinois, possesses an "ability to inspire" and praised the "inclusive nature of his campaign" while showing "steadiness" in the rigors of the long presidential campaign.
"Obama displayed a steadiness," Powell said. "(He) showed intellectual vigor. He has a definitive way of doing business that will do us well."
The endorsement is significant because Powell is a prominent Republican and was once considered a likely GOP candidate for president, serving President George Bush as his first Secretary of State.
Powell said he questioned the judgment of Republican nominee Sen. John McCain of Arizona in his choice of Alaska Gov. Sarah Palin as his vice presidential running mate and was "disappointed" in his campaign tactics of trying to tie Obama to former 1960s radical William Ayers.