Objectives Subjective memory complaints (SMCs) in the elderly are associated with poor recovery in performing activities of daily living. This study was designed to examine SMCs and their association with recovery and health outcomes of older persons within 1 year following hospital discharge after hip‐fracture surgery. Methods Data were collected between 2012 and 2015 from 194 hip‐fractured elders in northern Taiwan. SMCs were assessed by the Prospective and Retrospective Memory Questionnaire. Recovery outcomes included self‐care ability (activities of daily living [ADLs] and instrumental activities of daily living [IADLs]), physical function (range of motion and maximal muscle strength), cognitive function, delirium, depressive symptoms, and health‐related quality of life (HRQoL). Outcomes were assessed before discharge and 1, 3, 6, and 12 months afterwards. Associations of SMCs with participants' recovery outcomes were examined by the generalized estimating equation approach. Results Participants with SMCs had significantly poorer recovery outcomes than those without SMCs. Additionally, the interaction term for time‐by‐SMC was significant on ADLs, IADLs, maximal strength of quadriceps muscles, maximal strength of hip abductor muscles, ankle dorsiflexion, and HRQoL, suggesting that negative associations with SMCs increased over time. Participants with SMCs were at significantly higher risk for cognitive impairment and delirium than those without SMCs. Conclusions Participants with SMCs not only had worse recovery than those without SMCs, but their rate of recovery was also slower during the first year following hip‐fracture surgery. Therefore, SMCs need to be assessed to identify patients at high risk for worse recovery outcomes following hip fracture.