BackgroundObesity is a well-established risk factor for multi-morbidity and disability among older adults in the community and acute care settings. However, nursing home residents with body mass index (BMI) below 18.5 kg/m2 and above 25.0 kg/m2 have been understudied. We examined the prevalence of multi-morbidity and disability in activities of daily living (ADL) by BMI category and further investigated the association between BMI, multi-morbidity, and disability of ADL in a large cohort of older adults in nursing homes in New Zealand.MethodsA retrospective review of nursing home residents’ data obtained from the New Zealand International Resident Assessment Instrument national dataset from 2015 to 2018. One hundred ninety-eight thousand seven hundred ninety older adults (≥60 years) living in nursing homes were included. BMI was calculated as weight in kilograms (kg) divided by height in meters squared (m2). Multimorbidity was defined as the presence of ≥2 health conditions. The risk of disability was measured by a 4-item ADL self-performance scale. The prevalence ratio (PR) of the association between BMI and multi-morbidity and between BMI and disability in ADL was assessed using Poisson regression with robust variance.ResultsOf the 198,790 residents, 10.6, 26.6, 11.3 and 5.4% were underweight, overweight, obese, and extremely obese, respectively. 26.4, 31.3 and 21.3% had one, two and three disease conditions, respectively, while 14.3% had four or more conditions. 24.1% could perform only one ADL, and 16.1% could perform none. The prevalence of multi-morbidity increased with increasing BMI, whereas mean disability in ADL decreased with increasing BMI. The risk of multi-morbidity was higher for the overweight (PR, 95%CI: 1.03, 1.02–1.03) and obese (PR, 95% CI: 1.07, 1.06–1.08) compared to normal weight after controlling for age, sex, ethnicity, and region. BMI was inversely associated with mean ADL; β, 95% CI for overweight (− 0.30, − 0.32, − 0.28) and obese − 0.43, − 0.45, − 0.40 compared to normal weight.ConclusionBeing underweight was associated with a decline in the performance of ADL in nursing home residents. In contrast, being overweight and obese positively affected functional performance, demonstrating that the obesity paradox plays an important role in this population. The observed associations highlight areas where detection and management of underweight and healthy aging initiatives may be merited.