Background and Purpose: Modified Rankin Scale (mRS) score 0-2 has been used to define “good outcome” while stroke patients with mRS 3 are grouped with mRS 4-6 as having “poor outcome.” Long-term data comparing quality of life (QoL), particularly across the mRS 2, 3, and 4 subgroups, are sparse. Methods: Participants in the Interventional Management of Stroke 3 (IMS3) trial with documented 3-month mRS, functional disability (Barthel index [BI]), and self-reported EQ5D-3L QoL questionnaires at 3 months after stroke were included. EQ5D-3L summary indices were calculated using published utility weights for the US population. BI and EQ5D-3L indices were compared across mRS categories using multiple pairwise comparisons with appropriate alpha error corrections. Results: Four hundred twenty-three patients were included (mean age 64 ± 13 years, median baseline NIHSS 16 [IQR 12-19], mean BI 84.1 ± 25.3, and mean EQ5D-3L index 0.73 ± 0.24). While significant differences in BI were observed across mRS categories, QoL in the mRS 2 and 3 categories was similar. Based on BI and EQ5D-3L index, mRS 3 status was more similar to mRS 2 than to mRS 4 status, and large heterogeneity in the mRS 3 group was observed. Conclusions: Ischemic stroke patients who achieve mRS 2 and 3 functional outcomes seem to have similar health-related QoL scores. mRS 0-3, rather than 0-2, should be considered a good outcome category in moderate to severe ischemic stroke.