Background In the context of an aging end-stage renal disease population with multiple comorbid conditions, transplantation professionals face challenges in evaluating the global health of patients awaiting kidney transplantation. Functional status might be useful for identifying which patients will derive a survival benefit from transplantation versus dialysis. Study Design Retrospective cohort study of wait-listed patients using data for functional status from a national dialysis provider linked to United Network for Organ Sharing registry data. Setting & Participants Adult kidney transplantation candidates added to the waiting list between 2000 and 2006. Predictor Physical Functioning scale of the Medical Outcomes Study 36-Item Short Form Health Survey, analyzed as a time-varying covariate. Outcomes Kidney transplantation; survival benefit of transplantation versus remaining wait-listed. Measurements We used multivariable Cox regression to assess the association between physical function with study outcomes. In survival benefit analyses, transplantation status was modeled as a time-varying covariate. Results The cohort comprised 19,242 kidney transplantation candidates (median age, 51 years; 36% black race) receiving maintenance dialysis. Candidates in the lowest baseline Physical Functioning score quartile were more likely to be inactivated (adjusted HR vs highest quartile, 1.30; 95% CI, 1.21-1.39) and less likely to undergo transplantation (adjusted HR vs highest quartile, 0.64; 95% CI, 0.61-0.68). After transplantation, worse Physical Functioning score was associated with shorter 3-year survival (84% vs 92% for the lowest vs highest function quartiles). However, compared to dialysis, transplantation was associated with a statistically significant survival benefit by 9 months for patients in every function quartile. Limitations Functional status is self-reported. Conclusions Even patients with low function appear to live longer with kidney transplantation versus dialysis. For wait-listed patients, global health measures such as functional status may be more useful in counseling patients about the probability of transplantation than in identifying who will derive a survival benefit from it.