WASHINGTON—Consumer confidence dropped in January for a third consecutive month, likely hit by political discord in Washington, in addition to market and economic uncertainty weighing on U.S. households.

The Conference Board on Tuesday said its index of U.S. consumer confidence fell to 120.2 in January from 126.6. It is now down 17.7 points from October, marking the largest three-month decline since October 2011. Economists surveyed by The Wall Street Journal had expected a drop, albeit a less dramatic one.