Objective To investigate the clinical characteristics of older adults undergoing inpatient rehabilitation after hip fractures and to find factors associated with discharge location. Design Cross-sectional analysis. Setting Inpatient rehabilitation units in the United States. Participants ≥65 years old patients with hip fractures. Intervention Inpatient rehabilitation with ≥1 hour of physical and occupational therapy per weekday. Main measures Home versus nonhome discharges. Results 79% of 7439 ( n = 5,908) patients were discharged to home after a median stay of 14 days, while 13% ( n = 990) were discharged to skilled nursing facilities. 6% ( n = 423) were transferred to acute care during rehabilitation stay. Functional mobility levels for bed-to-chair transfer and sit-to-stand at admission were significantly lower in patients discharged to facilities than in patients discharged to home. Older age (OR 0.97 per 1 year, CI 0.96–0.98); comorbidities of dementia (OR 0.68, CI 0.56–0.83) and cerebrovascular disease (OR 0.53, CI 0.36–0.78); and the use of opioid analgesics (OR 0.71, CI 0.56–0.91), antipsychotics (OR 0.73, CI 0.58–0.92), and anticonvulsants (OR 0.81, CI 0.67–0.96), and lower initial functional levels in bed-to-chair transfers (OR 0.08, CI 0.05–0.12) for dependent level; OR 0.16, CI 0.10–0.25 for level requiring maximal assistance; OR 0.38, CI 0.24–0.60 for level requiring partial, moderate assistance), were associated with a decreased likelihood of discharge to home after inpatient rehabilitation. Conclusion Older adults with dementia, cerebrovascular disorders, and lower bed-to-chair transfer mobility levels at admission after hip fractures may benefit from additional targeted rehabilitation to improve the chances of a successful community discharge.