Objective. Functional limitation is a major factor in medical costs. This study was undertaken to evaluate the prevalence of functional limitation among adults with arthritis and the frequency of functional decline over 2 years, and to investigate factors amenable to public health intervention that predict functional decline.Methods. Longitudinal data (1998-2000) from a cohort of 5,715 adults ages 65 years or older with arthritis from a national probability sample were analyzed. Function was defined based on ability to perform basic activities of daily living (ADL) tasks and instrumental ADL. Adjusted odds ratios (ORs) from a multiple logistic regression model were used to estimate the associations between functional decline and comorbid conditions, health behaviors, and economic factors.Results. Overall, 19.7% of this cohort had functional limitation at baseline, including 12.9% with ADL limitations. Over the subsequent 2 years, function declined in 13.6% of those at risk. Functional decline was most frequent among women (15.0%) and minorities (18.0% Hispanics, 18.7% African Americans) with arthritis. Lack of regular vigorous physical activity, the most prevalent risk factor (64%), almost doubled the odds of functional decline (adjusted OR 1.9, 95% confidence interval 1.5-2.4) after controlling for all risk factors. It was found that if all subjects engaged in regular vigorous physical activity, the expected functional decline could be reduced as much as 32%. Other significant predictors included older age, cognitive impairment, depressive symptoms, diabetes, physical limitations, no alcohol use, stroke, and vision impairment.Conclusion. Lack of regular vigorous physical activity is a potentially modifiable risk factor that could substantially reduce functional decline and associated health care costs. Prevention/intervention programs should include regular vigorous physical activity, weight maintenance, and medical intervention for health needs.High economic, societal, and personal costs from functional limitation among older adults make the prevention of functional problems an important public health issue (1-3). Medical spending among the elderly is related more closely to the presence of functional limitation than to remaining life expectancy (4,5). In 1999, more than 44 million Americans had 1 or more conditions that resulted in a limitation of life activities (6), and in 1996, direct medical costs for persons with disability exceeded $260 billion (6). Arthritis and other rheumatic conditions (hereinafter called arthritis) are leading causes of disability in the US (6). Arthritis affects almost 60% of persons ages 65 years and older (7), of whom more than 1 in 10 report activity limitations (8). By 2010, almost 40 million Americans ages 65 years or older are projected to have arthritis (9), potentially escalating the numbers of older adults with functional impairments.An understanding of risk factors related to functional decline is essential to the development of population-based public health programs to...