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"He has both style and substance. I think he is a transformational figure," Powell said on NBC's "Meet the Press."
"Obama displayed a steadiness. Showed intellectual vigor. He has a definitive way of doing business that will do us well," Powell said.
Powell, a retired U.S. general and a Republican, was once seen as a possible presidential candidate himself.
Powell said he questioned Sen. John McCain's judgment in picking Gov. Sarah Palin as his running mate because he doesn't think she is ready to be president.
He also said he was disappointed with some of McCain's campaign tactics, such as bringing up Obama's ties to former 1960s radical Bill Ayers.
Powell served as secretary of state under President Bush from 2001 to 2005.
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