Advancing age and adiposity contribute to musculoskeletal degenerative diseases and the development of sarcopenic obesity. The etiology of muscle loss is multifactorial, and includes inflammation, oxidative stress and hormonal changes, and is worsened by activity avoidance due to fear of pain. The risk for mobility disability and functional impairment rises with severity of obesity in the older adult. Performance measures of walking distance, walking speed, chair rise, stair climb, body transfers and ability to navigate obstacles on a course are adversely affected in this population, and this reflects decline in daily physical functioning. Exercise training is an ideal intervention to counteract the effects of aging and obesity. The 18 randomized controlled trials of exercise studies with or without diet components reviewed here indicate that 3–18 month programs that included aerobic and strengthening exercise (2–3 days per week) with caloric restriction (typically 750 kcal deficit/day), induced the greatest change in functional performance measures compared with exercise or diet alone. Importantly, resistance exercise attenuates muscle mass loss with the interventions. These interventions can also combat factors that invoke sarcopenia, including inflammation, oxidative stress and insulin resistance. Therefore, regular multimodal exercise coupled with diet appears to be very effective for counteracting sarocpenic obesity and improving mobility and function in the older, obese adult.