Decreased physical function is associated with increased fall risk. Fall risk increase with increasing age, and falls are associated with decreased quality of life in the elderly, as well as increased morbidity and mortality. Exercise is found to be effective in increasing physical function and preventing falls, but the preferred exercise program is still uncertain. PURPOSE: To investigate the effect of three different exercise programs on physical function and fall risk among elderly. METHODS: In this single blinded study, 90 men and women (74.4±6.5 yr) were randomized to one of three exercise groups: Traditional Senior Exercise Group (TSEG) (n=30), "InHarmony" Exercise Group (IHEG) (dynamic movements on unstable surface) (n=30), and outdoor Walking Exercise Group (WEG) (n=30). All groups followed instructor-guided exercise 2 × 60 minutes/week for 16 weeks. Fall risk was measured with the short version of the Physiological Profile Assessment (PPA) (including contrast sensitivity, reaction time, proprioception, knee extention force, and sway). In addition, physical function was measured using the following tests from the Senior Fitness Test Battery: 6-Minute Walk Test (6MWT), 30s Chair Stand Test (30sCST), and Time Up and Go Test (TUGT). Finally, dynamic balance was measured with the Four Square Step Test (FSST). RESULTS: There were no differences between the groups at baseline. Within group comparison, the TSEG improved their results in the 30sCST (21.8%), TUGT (6.5%) and FSST (18.8%) (all results, p<0.01). The IHEG improved their results in the 30sCST (17.1%) (p<0.001) and FSST (7.7%) (p<0.05). The WEG improved their results in the 6MWT (8.1%) (p<0.05), 30sCST (23.4%) (p<0.01), TUGT (7.3%) (p<0.05), and FSST (17.7%) (p<0.01). No differences in fall risk were found between the exercise groups based on a three group comparison. However, the WEG improved their result in the 6MWT from pre- to posttest as compared to the TSEG (p<0.05). CONCLUSION: All exercise programs in this study seem to improve physical function in the elderly. Outdoor walking on uneven ground may be just as effective as indoor, instructor-guided exercise in terms of improving physical function in elderly. On the other hand, more knowledge is needed regarding which exercise program is to be preferred in order to decrease fall risk in this age group.