Objective Misjudgments of vehicle speed or distance frequently lead to collisions, particularly among older pedestrians who are less accurate in estimating vehicle speeds than younger individuals. However, comprehensive studies that assess multiple factors influencing speed perception in older pedestrians are lacking. Methods This research utilized computer simulations to explore how vehicle color (red, green, blue) and direction of travel (approaching or receding) affect perceived speed errors in both relative and absolute judgment scenarios among older pedestrians. Results Data from 38 older adults and 40 college students indicated that red vehicles were associated with fewer perceived speed errors than either green or blue vehicles. Errors increased for vehicles moving away, with absolute judgments showing greater discrepancies than relative ones. Analysis revealed that, across various combinations of the three independent variables—vehicle color, vehicle direction, and judgment type—the older participants exhibited significantly larger perceived speed errors compared to college students. Furthermore, the study identified significant interactions between vehicle color and direction, and between judgment type and vehicle direction. Conclusion Our findings are beneficial in understanding the factors influencing older pedestrians’ speed perceptions, aiding public safety and informing car design to ensure safer roads for older pedestrians.