Indiana University climbed to 5th place from 15th a year earlier in this year's The Wall Street Journal annual ranking of business schools.
IU, which was classified among regional institutions, performed better this year than Purdue University, which saw its ranking drop to 12th from 4th.
The University of Notre Dame climbed to 14th from 28th.
The newspaper rates business schools by surveying corporate recruiters. Recruiters are asked to assess 21 attributes, including curriculum content, leadership potential and strategic thinking.
IU rose because more experiential learning was included in the curriculum, the Journal said. Recruiters also said they liked the university's faculty expertise and course content.
"Indiana's graduate career services office is increasingly partnering with corporations such as Johnson & Johnson to identify high-caliber students that meet the company's needs," Scott Kleman, a survey respondent and senior financial analyst at J&J's Ethicon Endo-Surgery unit in Cincinnati, told the newspaper. "The school promotes "real-life projects that allow companies and students to work together in a 'pseudo-internship.' The companies have another channel to meet and evaluate talent, while students are able to apply their learning to a practical problem and make a good impression on a potential employer."
Purdue, which placed at the top of the regional rankings in 2004 and 2005, was downgraded by recruiters because students had limited work experience.
Competition for top graduates is intense.
Whirlpool Corp., for example, is recruiting beyond a base traditionally consisting of such institutions as Indiana University and the University of Michigan to include Dartmouth College, the University of Southern California and the University of Texas.
Last year, Whirlpool hired four MBAs each from IU and Notre Dame. Intel Corp. hired eight from Purdue.
When ranked by academic disciplines, the recruiters placed IU placed 3rd in marketing and 8th in accounting.
Purdue was 3rd in operations management, 10th in information technology.
Notre Dame was 9th in accounting and 4th in corporate social responsibility, a new category based on nominations.
The academic rankings included all universities, and were not limited to regional and other categories.