Although osteoarthritis (OA) is common among adults, little is known about its long-term impact on physical function. Therefore, in a cohort of 2,884 adults aged 45 years or older, [National Health and Nutrition Examination Survey I (NHANES I 1971-1975)] we examined the association of baseline radiographic knee OA and difficulty in physical functioning 10 years later (NHANES I Followup Study 1982-1984). In sex specific analyses, after controlling for age, race and length of followup, persons with radiographic knee OA were more likely than persons without knee OA to report difficulty with physical functioning, particularly for activities involving mobility, transfer and instrumental activities of daily living. However, the association of knee OA with physical functioning was influenced by the radiographic grade of OA and knee pain at NHANES I, suggesting that disease severity and pain are important in anticipating difficulties with physical functioning in persons with knee OA.