Purpose <p>We conducted a longitudinal secondary data analysis to estimate long-term functional limitation trajectories of adults over 50 with cancer compared to cancer-free individuals.</p> Methods <p>Using the Health and Retirement Study (1998–2020), we followed adults over 50 without cancer history. Incident cancer was self-reported or proxy reported. Functional decline was assessed using self-reported independence in six domains, including instrumental activities of daily living (IADL), activities of daily living (ADL), mobility, large muscle, gross motor, and fine motor skills. We employed linear probability models with repeated measures to estimate independence probabilities.</p> Results <p>Among 15,972 participants (mean [SD] age, 66.1 [9.9] years), 23.1% reported cancer during follow-up. Before diagnosis, individuals with cancer had a 1.3% lower probability of IADL independence compared to cancer-free individuals (95% CI =  − 1.9, − 0.7). After diagnosis, cancer survivors experienced a sharp 6% drop in IADL independence, resulting in a 3.4% lower probability than in those without cancer (− 4.6, − 2.2). The annual rate of IADL decline after diagnosis was slower in cancer survivors compared to those without cancer (− 0.9% vs. − 1.3%). Similar patterns were observed for ADL. The greatest immediate reduction was in the gross motor domain with a decline of 8.6% (− 10.4, − 6.8).</p> Conclusions <p>Cancer survivors experienced rapid functional decline at diagnosis, possibly attributed to active treatment. Following diagnosis, cancer survivors had a more gradual loss in functional independence compared to cancer-free individuals.</p> Implications for cancer survivors <p>Findings underscore the importance of proactive, tailored interventions to support functional independence in older cancer survivors, particularly around diagnosis.</p>