The ex-Ukip leader said he there was much to “admire” about how Truss was not afraid to “fight for radical change”.
Truss’ “Great British Growth Rally” held on the fringes of the Conservative Party conference attracted a huge crowd, with around 400 activists queuing to gain entry.
The popularity of the event, which also included speeches from Jacob Rees-Mogg and Priti Patel, was far greater than those given so far the main hall by current cabinet ministers.
Truss demanded Rishi Sunak cut taxes ahead of the election and called on party members to “unleash their inner Conservative”.
Speaking to reporters at the side of the rally, Farage said there was a “pretty rebellious mood” among Conservatives who had “a real desire to reset the party”.
“There is a battle going on here isn’t there. What is really happening this week is the debate about who and what takes over the party after [they] lose the next election,” he said.
“I have no loyalty to any party, never have had. I led Ukip for all those years not because I loved Ukip, it was a vehicle, it was effective and got things changed.
“It’s policy that interest me. I think this woman has shown - in some areas - she is prepared to show up, take the abuse and fight for radical change and that I do admire.”
Farage added it was a “very different question” as to whether Truss “got it right” while serving as prime minister.
He said Truss had played “all the right notes, just not in the right order” while in No.10.
Truss’ appearance in Manchester has threatened to overshadow Sunak’s attempt to relaunch his premiership ahead of next year’s election.
It has irritated many in the party who want to project unity rather than division. “I don’t think she should be here,” one leading Tory told party activists on Sunday.
The intervention is seen as part of the jostling among potential Tory leadership candidates.
Patel, who told Sky News that “no”, Truss could not make a return as party leader, has also not ruled out standing in any future contest.