UPDATE 1-Forrester raises U.S. e-reader forecast

* Sets estimate at 3 million units

* 2010 sales expected to double

SAN FRANCISCO, Oct 6 (Reuters) - Forrester Research on Tuesday raised its 2009 forecast for e-reader sales in the United States to 3 million units, underscoring the increasing popularity of the devices.

The industry tracker had previously estimated sales of 2 million units.

For 2010, U.S. sales are expected to double, bringing cumulative e-reader sales to 10 million by the year’s end, Forrester said in a report scheduled to be released on Wednesday.

“This holiday season, eReaders will be one category that’s a breakout success,” Forrester analyst Sarah Rotman Epps said in the report. “Lower prices, more content, better distribution, and lots of media hype are contributing to faster-than-expected adoption of eReader devices in 2009.”

Forrester predicts 900,000 units will sell during the holiday season. Inc AMZN.O and its Kindle reader are expected to dominate the category with a 60 percent market share for 2009, followed by Sony Corp's 6758.T Reader line with a 35 percent share.

Although new digital readers continue to enter the market, Forrester predicts device makers like Interead and iRex will account for only 5 percent of sales. (Reporting by Gabriel Madway; editing by Carol Bishopric)