Individuals must be able to maintain an upright posture under a variety of conditions and to move independently. These constructs of balance and gait are fundamental components of physical functioning and should be incorporated into clinical assessment of older adults. The primary objective, therefore, is to review existing measures of functional balance and gait, concentrating on those which are quantitative, practical for use in clinical settings, and have demonstrated acceptable measurement properties. In addition, we discuss the rationale for the functional assessment of balance and gait, review essential measurement criteria, and discuss the utility of valid standardized measurement in clinical practice.