Objectives To explore patterns of change in nursing home (NH) residents' activities of daily living (ADLs), particularly surrounding acute hospital stays. Design Longitudinal study using Medicare and Minimum Data Set (MDS) assessments. Setting National sample of long-stay NH residents. Participants NH residents who were hospitalized for the seven most-common inpatient diagnoses (N = 40,128). Each hospital admission was at least 90 days after any prior hospitalization and had at least two preceding MDS assessments. Measurements The MDS ADL long-form score, a simple sum of seven self-care variables coded from 0 (independent) to 4 (totally dependent) was used to indicate resident ADL function. Scores ranged from 0 to 28, with higher scores indicating greater impairment. A linear mixed model describing ADL trajectories was jointly estimated with time-to-event models for mortality and hospital readmission. Results Before hospitalization, the most common trajectory was stable (53.7%), with 27.5% of residents worsening and 18.8% improving. ADL function after hospital discharge was most often characterized as stable (43.1%) or worsening (39.2%). Mortality (20.3%) was higher for those with worsening prehospital ADL function (28.9%) than for those with stable (19.1%) or improving (11.3%) trajectories. Hospital diagnosis was associated with amount of ADL worsening and rate of subsequent ADL change. Most residents with the best initial function continued to worsen after hospital discharge. Cognitive impairment was associated with poorer ADL function and accelerated worsening of ADLs. Conclusion For many long-stay NH residents, substantial and sustained ADL worsening accompanies acute hospitalization, so acute hospitalization presents an opportunity to revisit care goals; the results of the current study can help inform decision-making. © 2013, The American Geriatrics Society.