The purpose was to describe four-year change in functional ability among older persons and the relationship to sex, age, and other background factors. The baseline study, performed in 1986, is based on a random sample of older persons (n=1261). Follow-up data were collected four-years later (n=912). The analyses of change in functional ability were based on the assumption that the categories reflected an underlying latent continuous dimension. The change in functional ability, DeltaFA, was calculated by a logistic model for paired observations and applied in parallel analyses with and without inclusion of the dead to deal with the attrition problem. Fifty percent had no change in functional ability, 37% had declined and 13% improved. Models including the dead showed more functional decline with increasing age but this was not the case when the dead were excluded. Functional change was not related to sex, functional ability at baseline, relative wealth, social network, self-rated health, and life-satisfaction. Inclusion of the dead in statistical models for the study of change in functional ability reduced the attrition problem. A logistic model for paired observations of functional ability at two points in time reduced the problem related to the floor/ceiling problem.