Dispositional optimism has been shown to be related to self-report measures of health and well-being, yet little research has examined the relationship between optimism and more objective measures of functioning. The purpose of this study was to examine the relationship between optimism and pessimism and objective physical functioning. Four hundred eighty community-dwelling older adults with knee pain completed a measure of optimism and pessimism and were observed performing four daily activities (walking, lifting an object, climbing stairs, and getting into and out of a car). Results indicated that pessimism was significantly related to performance on all four tasks (p < .001), while optimism was related to performance only on the walking task (p < .05), after controlling for demographic and health variables.