© 2018 The Authors Physical function is critical for mobility and quality of life. We hypothesized that higher total lean mass is associated with higher physical function, and body fat inversely associated, among postmenopausal women. Women's Health Initiative Observational Study participants at Pittsburgh, PA; Birmingham, AL; and Tucson-Phoenix, AZ (1993–1998) completed dual-energy X-ray absorptiometry scans and the Rand SF-36 questionnaire at baseline and 3 y (N = 4526). Associations between quartiles (Q1–4) of lean or fat mass and physical function were tested using linear regression, adjusted for demographics, lifestyle factors, medical history, and scanner serial number. At baseline, participants had a mean ± SD age of 63.4 ± 7.4 y and BMI of 27.4 ± 5.8 kg/m2. Higher percent lean mass was positively associated with physical function at baseline (Q4, 83.6 ± 0.6 versus Q1, 74.6 ± 0.7; p < 0.001), while fat mass (kg and %) was inversely associated (e.g., Q4, 73.7 ± 0.7 versus Q1, 84.2 ± 0.7 kg; ptrend < 0.001). Physical function had declined across the cohort at 3 y; the highest relative lean mass quartile at baseline conferred a lesser decline in physical function than the lowest (Q4, −3.3 ± 0.6 versus Q1–7.0 ± 0.6; ptrend < 0.001), while the highest fat mass quartile (% and kg) conferred greater decline (ex. Kg Q4, −6.7 ± 0.7 versus Q1–2.8 ± 0.6; ptrend < 0.001). Increased fat mass (≥5%), but not lean mass, was associated with lower physical function at 3 y (p < 0.001). Adiposity, as well as lean mass, requires consideration in the prediction of physical function among postmenopausal women over time.