To investigate the incidence and progression of age-related macular degeneration (AMD) and associated risk factors. Population-based, prospective, cohort study. We included 2868 participants from the Age Gene/Environment Susceptibility-Reykjavik Study with retinal data at baseline and 5-year follow-up. Digital macular photographs were graded for presence of AMD. Participants completed a questionnaire and extensive clinical battery. Biomarkers were assessed. Risk factors for AMD were analyzed using multivariate regression analysis with odds ratios (ORs) and 95% CIs. We assessed AMD, defined as early or late. Among 2196 participants free of AMD at baseline, 14.9% developed incident AMD. In multivariate models, incident AMD was significantly associated with age (OR per year, 1.14; 95% CI, 1.11-1.17), current smoking (OR, 2.07; 95% CI, 1.38-3.11), former smoking (OR, 1.36; 95% CI, 1.04-1.79), plasma high-density lipoprotein (HDL) cholesterol level (OR, 1.62 per mmol/L; 95% CI, 1.19-2.22), and body mass index (BMI; OR, 1.04 per kg/m(2); 95% CI, 1.01-1.07). Among 563 participants with early AMD at baseline, 22.7% progressed to late AMD (11.0% pure geographic atrophy GA and 11.7% exudative AMD). On multivariate analyses, age was significantly associated with progression to GA (OR 1.14; 95% CI, 1.07-1.21) and exudative AMD (OR, 1.08; 95% CI, 1.01-1.14). Adjusting for age, female sex was associated with exudative AMD (OR, 2.10; 95% CI, 1.10-3.98) and plasma HDL cholesterol with GA (OR, 2.03 per mmol/L; 95% CI, 1.02-4.05). By age 85, 57.4% of participants had signs of AMD. Age, smoking, plasma HDL cholesterol, BMI, and female sex are associated with AMD. Elevated HDL cholesterol is associated with GA development.