OBJECTIVE: To develop a model estimating the probability of a patient aged 80 years or older having functional limitations 2 months and 12 months after being hospitalized. DESIGN: A prospective cohort study. SETTING: Four teaching hospitals in the US. PARTICIPANTS: Enrolled patients were nonelective hospital admissions aged 80 years or older who stayed in hospital at least 48 hours. The 804 patients who survived and completed an interview at 2 months and the 450 who completed an interview at 12 months were from the 1266 patients in the Hospitalized Elderly Longitudinal Project (HELP) (76% and 47% of survivors, respectively). Median age of the 2-month survivors was 84.7 years. MEASUREMENTS AND MAIN OUTCOMES: Patient function 2 and 12 months after enrollment was defined by the number of dependencies in Activities of Daily Living (ADLs). Ordinal logistic regression models were constructed to predict functional status. Predictors included demographic characteristics, disease category, geriatric conditions, severity of physiologic imbalance, current quality of life, and exercise capacity and ADLs 2 weeks before study admission. RESULTS: Before admission, 39% of patients were functionally independent in ADLs. Of patients who survived and were interviewed at 2 months, 32% were functionally independent, and at 12 months, 36% were independent. Among patients with no baseline dependencies, 42% had developed one or more limitations 2 months later, and 41 % had limitations 12 months later. The patient's ability to perform activities of daily living at baseline was the most important predictor of functional status at both 2 and 12 months. In a multivariable predictive model, independent predictors of poorer functional status at 2 months included: worse baseline functional status and quality of life; depth of coma, if any; lower serum albumin level; presence of dementia, depression, or incontinence; being bedridden; medical record documentation of need for nursing home; and older age. Model performance, assessed using Somers' D, was 0.61 for 2 months and 0.57 for 12 months (Receiver Operating Characteristic (ROC) area = 0.81 and .79, respectively.) Bootstrap validation of the month 2 model also yielded a Somers' D = 0.60. The models were well calibrated over the entire risk range. The ROC area for prediction of the loss of independence was 0.76 for 2 months and 0.68 for 12 months. CONCLUSIONS: Many older patients are functionally impaired at the time of hospitalization, and many develop new functional limitations. A limited amount of readily available clinical information can yield satisfactory predictions of functional status 2 months after hospitalization. Models like this may prove to be useful in clinical care. This work illuminates a potential method for risk adjustment in research studies and for monitoring quality of care.