The Conference Board's consumer confidence index rose to 101.3 in March from revised 98.8 reading in February.
Confidence has risen to the highest levels since before the Great Recession started in December 2007. A year ago, the index stood at 83.9.
"The strength of confidence, along with improving labour market conditions, indicates that real consumption growth will accelerate over the coming months," Paul Ashworth, chief U.S. economist at Capital Economics, wrote in a research note.
The private business group takes into account expectations for the future and consumers' assessment of current conditions. Consumers were more optimistic about the future but a little less impressed with current economic conditions.
Confidence rose for those younger than 35 and 55 or older. It fell for Americans 35 to 54. The percentage of consumers who expect the economy will have more jobs in six months rose to 15.5 per cent from 13.8 per cent in February; 18.4 per cent said they expected their income to increase over the next six months, up from 16.4 per cent last month.
Consumers were more likely to say they would buy a car in the next six months but slightly less likely to say they intended to buy a home or major appliance, or go on vacation.
Over the past year, employers have added nearly 3.3 million jobs, the fastest 12-month pace of hiring since 1998.
The Commerce Department reported Monday that U.S. incomes rose a solid 0.4 per cent in February, matching January's uptick, a sign that wages may be beginning to grow again after a long period of stagnation.
Consumers are certainly acting more confident: Their spending rose at a 4.4 per cent annual rate from October through December, the fastest pace in eight years.