Background <p>Instrumental activities of daily living (IADL) limitations are important risk factors for dementia. IADL is lifestyle-based, therefore, its assessment content must be updated to reflect recent lifestyle changes. We evaluated the predictive validity of the National Center for Geriatrics and Gerontology Activities of Daily Living (NCGG-ADL), an IADL scale we previously developed, to identify dementia risk and the combined impact of mild cognitive impairment (MCI) and IADL limitations on dementia onset.</p> Methods <p>This population-based longitudinal study included 2,118 adults aged ≥ 65 years without dementia at baseline. At baseline, IADL limitations and MCI were assessed using the NCGG-ADL and a multi-domain neuropsychological test, respectively. The participants were followed up for new-onset dementia monthly for 5 years.</p> Results <p>Among all participants, 247 (11.7%) had IADL limitations at baseline, and 151 (7.1%) developed dementia during follow-up. Compared to participants without IADL limitations (NCGG-ADL 13 points), those with IADL limitations (NCGG-ADL ≤ 12 points) showed a significantly higher dementia onset risk (HR: 1.55 [95% CI: 1.04–2.31]). Regarding the combined impact of MCI and IADL limitations on dementia, the HRs (95% CIs) (reference: unimpaired cognition without IADL limitations) of unimpaired cognition with IADL limitations, MCI without IADL limitations, and MCI with IADL limitations were 1.53 (0.90–2.61), 1.87 (1.28–2.74), and 2.88 (1.65–5.03), respectively.</p> Conclusions <p>This study validated the NCGG-ADL as an effective screening tool for assessing dementia risk among community-dwelling older adults. Furthermore, concomitant MCI and IADL limitations was associated with a higher risk of dementia onset more than either condition alone. Therefore, this coexisting condition should be carefully monitored to prevent dementia.</p>