Previous studies have reported a close relationship between nutritional and functional domains, but evidence in long-term care residents is still limited. We evaluated the relationship between nutritional risk and functional status and the association of these two domains with mortality in newly institutionalised elderly. In the present multi-centric prospective cohort study, involving 346 long-term care resident elderly, nutritional risk and functional status were determined upon admission by the Geriatric Nutritional Risk Index (GNRI) and the Barthel Index (BI), respectively. The prevalence of high (GNRI <92) and low (GNRI 92–98) nutritional risk were 36·1 and 30·6 %, respectively. At multivariable linear regression, functional status was independently associated with age (P=0·045), arm muscle area (P=0·048), the number of co-morbidities (P=0·027) and mainly with the GNRI (P<0·001). During a median follow-up of 4·7 years (25th–75th percentile 3·7–6·2), 230 (66·5 %) subjects died. In the risk analysis, based on the variables collected at baseline, both high (hazard ratio (HR) 1·86, 95% CI 1·32, 2·63; P<0·001) and low nutritional risk (HR 1·52, 95% CI 1·08, 2·14; P=0·016) were associated with all-cause mortality. Participants at high nutritional risk (GNRI <92) also showed an increased rate of cardiovascular mortality (HR 1·93, 95% CI 1·28, 2·91; P<0·001). No association with outcome was found for the BI. Upon admission, nutritional risk was an independent predictor of functional status and mortality in institutionalised elderly. Present data support the concept that the nutritional domain is more relevant than functional status to the outcome of newly institutionalised elderly.