BACKGROUND: Dementia is a cause of disability in later life. Despite the importance of functional status to the diagnosis of dementia, limited information exists on differences in functional limitations by dementia subtype. We conducted a cross-sectional analysis using the Aging, Demographics, and Memory Study (ADAMS) to determine the extent of functional impairment among older adults with dementia due to different etiologies. METHODS: The ADAMS sample consisted of 856 individuals aged 71 years and older originally surveyed as part of the Health and Retirement Study. Based on a comprehensive in-person cognitive evaluation, respondents were assigned to diagnostic categories of normal cognition, cognitive impairment not demented, and demented. Dementia subtypes were grouped into three categories: vascular dementia (VaD), Alzheimer's dementia (AD), and dementia due to other etiologies. For 744 of the 856 respondents, a proxy informant completed a questionnaire asking whether the respondent had difficulty completing instrumental activities of daily living and activities of daily living (ADLs). RESULTS: Of 744 ADAMS participants, 263 had dementia: 199 (70.5%) with AD, 42 (16.9%) with VaD, and 22 (12.6%) were demented due to other etiologies. After adjustment for demographics, chronic illnesses, and dementia severity, participants with VaD (odds ratio [OR] 5.74; 95% confidence interval [CI] 2.60-12.69) and other etiologies of dementia (OR 21.23; 95% CI 7.25-62.16) were more likely to have greater than or equal to four ADL limitations compared with those with AD. CONCLUSIONS: VaD is associated with significantly more ADL limitations than AD. These physical limitations should be considered when designing adult day care programs, which adequately accommodate the needs of non-AD patients.