Older adults have the highest rates of head injury and are at the greatest risk for subsequent dysfunction, yet research on subsequent physical decline is limited. We sought to examine cross-sectional and prospective associations of head injury with physical functioning and frailty among older adults. A total of 5598 Atherosclerosis Risk in Communities Study participants from Visit 5 (2011-13) underwent assessments of physical functioning (Short Physical Performance Battery [SPPB], comprised of gait speed, chair stands, and balance) and frailty (defined using established criteria) were followed through Visit 7 (2018-19). Head injury was self-reported or based on ICD-9 codes. Adjusted linear and multinomial logistic regression models were used to estimate associations. Prospective models incorporated inverse probability of attrition weights to account for death or attrition. Participants were a mean age of 75 years, 58% were women, 22% were Black, and 27% had a prior head injury. Compared to individuals without head injury, individuals with head injury had worse physical functioning (SPPB total score, β-coefficient = -0.22, 95% CI: -0.35 to -0.09) and were more likely to be pre-frail (OR = 1.19, 95% CI: 1.04 to 1.35) or frail (OR = 1.40, 95% CI: 1.08 to 1.80) compared to robust. Prospectively, head injury was associated with a 0.02 m/s greater decline (95% CI: -0.04 to -0.01) in gait speed over a median of 5 years. Among baseline robust individuals (n = 1847), head injury was associated with increased odds of becoming pre-frail (OR = 1.32, 95% CI: 1.04 to 1.67) or frail (OR = 1.92, 95% CI: 1.05 to 3.51) compared to robust. Older adults with prior head injury had worse physical functioning and greater frailty at baseline and were more likely to become frail and walk slower over time, compared to individuals without head injury.