"Growth of business activity has now accelerated for three successive months, having almost stalled back in November, driven higher by stronger demand," Markit said in its release. "New orders also grew at the sharpest rate for seven months in February."
The services sector drove February's growth in business activity, with manufacturing expansion remaining relatively subdued.
The region-wide figure got a boost from two of the currency bloc's biggest economies.
Germany's composite reading ticked up in February, to 54.3 points from 53.5 points in January.
The reading for France, where economic growth has lagged that of its euro zone neighbors in recent months, also came in better than expected. Its composite PMI rose to 52.2 - the highest reading in three and a half years, and up from 49.3 in January.
Howard Archer, chief European economist at IHS Global Insight, described the figures as "genuinely encouraging."
"There are mounting signs that euro zone economic activity really is now improving, which reinforces our frequently stated belief that growth will surprise on the upside in 2015," he wrote in a note.
In the fourth quarter of 2014, economic growth in the region beat expectations but remained anemic, with the economy expanding by 0.3 percent.