Background The Life-Space Assessment (LSA) has demonstrable validity and reliability among people sampled from nonclinical settings. Its properties in clinical settings, especially physical therapy services, are less well established. Objective The aim of this study was to test the construct/convergent validity, responsiveness, and floor/ceiling effects of the LSA among patients who had musculoskeletal, orthopedic, neurological, or general surgical presentations and were receiving individually tailored, community-based physical therapist interventions to address gait/balance impairments in an urban location in the United Kingdom. Design A prospective, repeated-measures, comparative cohort design was used. Methods Two hundred seventy-six community-dwelling, newly referred patients were recruited from three cohorts (outpatients; domiciliary, nonhospitalized; and domiciliary, recent hospital discharge). Data were collected from the LSA and the Performance-Oriented Mobility Assessment (POMA1) at initial assessment and discharge. Two hundred twenty-eight participants were retained at follow-up. Results The median age was 80.5 years, 73.6% were women, and the median number of physical therapist contacts over 53 days was five. LSA scores at assessment and changes over treatment distinguished between cohorts, even after adjustment for covariates. Weak correlations (0.14–0.41) were found between LSA and POMA1 scores. No LSA floor/ceiling effects were found. Significant improvements in the LSA score after the intervention were found for each cohort and for the sample overall. For the whole sample, the mean change in the LSA score was 10.5 points (95% CI = 8.3–12.8). Limitations The environmental demands participants faced were not measured. Caregivers answered the LSA questions on behalf of participants when necessary. Assessors were not always masked with regard to the measurement point. Conclusions The LSA has utility as an outcome measure in routine community-based physical therapist practice. It has satisfactory construct validity and is sensitive to change over a short time frame. The LSA is not a substitute for the POMA1; these measures complement each other, with the LSA bringing the added value of measuring real-life functional mobility.