Exergames are increasingly used in rehabilitation settings for older adults to train physical and cognitive abilities. To meet the potential that exergames hold, they need to be adapted to the individual abilities of the player and their training objectives. Therefore, it is important to know whether and how game characteristics affect their playing. The aim of this study is to investigate the effect of two different kinds of exergame (step game and balance game) played at two difficulty levels on brain activity and physical activity. Twenty-eight older independently living adults played two different exergames at two difficulty levels each. In addition, the same movements as during gaming (leaning sideways with feet in place and stepping sideways) were performed as reference movements. Brain activity was recorded using a 64-channel EEG system to assess brain activity, while physical activity was recorded using an accelerometer at the lower back and a heart rate sensor. Source-space analysis was applied to analyze the power spectral density in theta (4 Hz-7 Hz) and alpha-2 (10 Hz-12 Hz) frequency bands. Vector magnitude was applied to the acceleration data. Friedman ANOVA revealed significantly higher theta power for the exergaming conditions compared to the reference movement for both games. Alpha-2 power showed a more diverse pattern which might be attributed to task-specific conditions. Acceleration decreased significantly from the reference movement to the easy condition to the hard condition for both games. The results indicate that exergaming increases frontal theta activity irrespective of type of game or difficulty level, while physical activity decreases with increasing difficulty level. Heart rate was found to be an inappropriate measure in this population older adults. These findings contribute to understanding of how game characteristics affect physical and cognitive activity and consequently need to be taken into account when choosing appropriate games and game settings for exergame interventions.