Rising for the third straight session, the BSE's 30-share barometer rose by 100.86 points, or 0.48 per cent, to 21,294.44. In the previous two sessions, Sensex had gained 160.87 points.
The wide-based National Stock Exchange index Nifty also edged higher by 17.80, or 0.28 per cent, to 6,331.60.
Brokers said the sentiment remained firm on steady foreign fund inflows coupled with a firming trend on other Asian bourses.
In the Asian region, Japan's Nikkei gained 0.38 per cent, while Hong Kong's Hang Seng rose by 0.47 per cent in early trade today.