ObjectivesTo investigate the recovery of physical function, health related quality of life (HRQoL), and pain for people following hip fracture for the initial 12 months, and to examine whether postoperative outcome measures of physical function, HRQoL, and pain can predict physical function at 3 and 12 months.DesignA prospective single‐center observational study, as part of the HIPFRAC trial. Settings: One hospital with two associated municipalities in Norway. Subjects: 207 participants with hip fracture included in the study (140 participants transferred to a short‐term nursing home placement and 67 transferred directly home at discharge from hospital).MethodOutcome measures were Short Physical Performance Battery (SPPB), Timed Up & Go (TUG), Stair climbing test (SC), Numeric Rating Scale (NRS) for pain at rest and in activity, and EQ‐5D‐5L index and health score. Data were analysed by repeated measures of variance and multivariate regression analyses.ResultsThere were statistically significant improvements in physical function (SPPB total score and TUG), NRS‐pain in activity, and HRQoL (EQ‐5D‐5L) from hospital discharge to 3‐month follow‐up for the whole cohort and the two groups (p < 0.001). However, the largest improvements occurred within the first 3 months. Further statistically significant improvements occurred between 3 and 12 months (p < 0.05). The strongest predictors of physical function at 3 and 12 months post‐fracture were physical function (SPPB) at hospital discharge and pre‐fracture requirement of a walking aid.ConclusionThe recovery of physical function, HRQoL, and pain in participants after hip fracture indicates gradual improvements during the initial 12‐month follow‐up, with the largest improvements within the first 3 months.