OBJECTIVES: To describe the independent contributions of selected medical conditions to the disparity between black and white people in disability rates, controlling for demographic and socioeconomic factors. DESIGN: Cross-sectional analysis of a community-based cohort. SETTING: Urban and rural counties of central North Carolina. PARTICIPANTS: Two thousand nine hundred sixty-six adults aged 68 and older participating in the Duke Established Populations for Epidemiologic Studies of the Elderly (EPESE). MEASUREMENTS: Self-reported data on sociodemographic characteristics and medical conditions, Short Portable Mental Status Questionnaire, activities of daily living (ADLs). RESULTS: Fifty-five percent of the cohort was black. Blacks were more likely than whites to report disability (odds ratio=1.39, 95% confidence interval= 1.15-1.68). Controlling for age, sex, marital status, and socioeconomic status, blacks were more likely to be obese and have diabetes mellitus, and less likely to report vision problems, fractures, and heart attacks. The higher prevalence of obesity and diabetes mellitus in blacks, after adjustment for sociodemographic factors, accounted for more than 30% of the black-white difference in disability. Conversely, the black-white disability gap would be approximately 45% wider if whites had a lower prevalence of fractures and vision impairment, similar to their black peers. CONCLUSION: Higher rates of obesity and diabetes mellitus in older black Americans account for a large amount of the racial disparity in disability, even after controlling for socioeconomic differences. Culturally appropriate interventions that lower the prevalence or the functional consequences of obesity and diabetes mellitus in blacks could substantially decrease this racial health disparity.