ABSTRACT. Background: The functional capacity of elderly individuals with Alzheimer disease (AD) progressively declines. Objective: To verify the influence of sociodemographic, clinical, staging, mobility, and postural and cognitive balance data on the impairment of the functional capacity of elderly individuals with AD. Methods: This observational, analytical, cross-sectional study was performed at the Physiotherapy Department of the Universidade Federal do Rio Grande do Norte, Natal, Rio Grande do Norte, Brazil. The study consisted of forty elderly individuals aged ≥60 years old with mild or moderate AD, who could ambulate independently. The instruments used included a questionnaire to assess sociodemographic and anthropometric data; the Mini-Mental Health State Examination (MMSE); the Clinical Dementia Rating (CDR); a clock drawing test (CDT); a verbal fluency test (VFT); the Timed Up and Go Test (TUG); and the Clinical Test of Sensory Organization and Balance (CTSIB). Simple descriptive analyses, Mann-Whitney test, Spearman's correlation test, linear regression modeling, and prediction equation (p<0.05, 95% confidence interval [95%CI]) were performed. Results: Fifteen linear regression models were generated, with the final model chosen for analysis. The variables assumed in that model were CDR, MMSE score, and condition 3 of the CTSIB, which explained 60.1% of the outcome. Conclusions: Impairment of functional capacity in elderly individuals with AD was influenced by disease progression, which was due to cognitive deficits and deficits in postural balance, which are related to the inaccuracy of the somatosensory system in performing sensory integration.