The workforce is aging and becoming more age‐diverse. To better support people working across the lifespan, it is important to understand the barriers they face and the consequences of such barriers. Drawing on the job demands‐resources model, we evaluate the negative effects of age discrimination on employees' perceived work ability and the subsequent consequences for employee well‐being, performance, and motivation. Using two field samples, with two and three data collection time‐points respectively, we hypothesize and find support for age discrimination's direct negative effect on perceived work ability. Moreover, we find support for our hypotheses that age discrimination will have negative indirect effects on employee well‐being, performance, and motivation through perceived work ability. Together, these studies contribute to the aging workforce literature and extend both the age discrimination and work ability literatures by identifying a mechanism through which age discrimination leads to negative consequences for employee well‐being and work outcomes.