How to convert a huge list-of-vector to a matrix more efficiently?

It would help to have sample information about your output. Recursively using rbind on bigger and bigger things is not recommended. My first guess at something that would help you:

z <- list(1:3,4:6,7:9)
do.call(rbind,z)

See a related question for more efficiency, if needed.

I think you want

output <- do.call(rbind,lapply(z,matrix,ncol=10,byrow=TRUE))

i.e. combining @BlueMagister's use of do.call(rbind,...) with an lapply statement to convert the individual list elements into 11*10 matrices ...

Benchmarks (showing @flodel's unlist solution is 5x faster than mine, and 230x faster than the original approach ...)

n <- 1000
z <- replicate(n,matrix(1:110,ncol=10,byrow=TRUE),simplify=FALSE)
library(rbenchmark)
origfn <- function(z) {
    output <- NULL 
    for(i in 1:length(z))
        output<- rbind(output,matrix(z[[i]],ncol=10,byrow=TRUE))
}
rbindfn <- function(z) do.call(rbind,lapply(z,matrix,ncol=10,byrow=TRUE))
unlistfn <- function(z) matrix(unlist(z), ncol = 10, byrow = TRUE)

##          test replications elapsed relative user.self sys.self 
## 1   origfn(z)          100  36.467  230.804    34.834    1.540  
## 2  rbindfn(z)          100   0.713    4.513     0.708    0.012 
## 3 unlistfn(z)          100   0.158    1.000     0.144    0.008 

If this scales appropriately (i.e. you don't run into memory problems), the full problem would take about 130*0.2 seconds = 26 seconds on a comparable machine (I did this on a 2-year-old MacBook Pro).

This should be equivalent to your current code, only a lot faster:

output <- matrix(unlist(z), ncol = 10, byrow = TRUE)