This study aimed to assess the status of intrinsic capacity (IC)-a novel function-centered construct proposed by the WHO and examine whether impairment in IC predicts subsequent 1-year activities of daily living (ADL) disability better than a disease-based approach, i. e., multimorbidity status. This study included data of community-dwelling older adults from the Beijing Longitudinal Study on Aging II aged 65 years or older who were followed up at 1 year. Multivariate logistic regressions were performed to estimate the odds of ADL disability at baseline and 1-year follow-up. A total of 7,298 older participants aged 65 years or older were included in the current study. About 4,742 older adults were followed up at 1 year. At baseline, subjects with a higher impairment in IC domains showed higher odds of ADL disability [adj. odds ratio (OR) = 9.51 for impairment in ≥3 domains, area under the curve (AUC) = 0.751] compared to much lower odds of ADL disability in subjects with a higher number (≥3) of chronic diseases (adj. OR 3.92, AUC = 0.712). At 1-year follow-up, the overall incidence of ADL disability increased with the impairment in IC domains higher than the increase in multimorbidity status. A higher impairment in IC domains showed higher odds of incidence ADL disability for impairment in 2 or ≥3 IC domains (adj. OR 2.32 for impairment in ≥3 domains, adj. OR 1.43 for impairment in two domains, AUC = 0.685). Only subjects who had ≥3 chronic diseases had higher odds of 1-year incident ADL disability (adj. OR 1.73, AUC = 0.681) that was statistically significant. Our results imply that a function-centered construct could have higher predictability of disability compared to the multimorbidity status in community older people. Our results need to be confirmed by studies with longer follow-up.