Aim We investigated the effects of metformin on cognitive function in a prospective cohort of older adults. Methods Participants aged ≥60 years were selected, and their Korean version of the Consortium to Establish a Registry for Alzheimer's Diseases Assessment, including the Mini‐Mental State Examination, and activities of daily living were evaluated prospectively. Rapid deterioration of cognitive function was defined as annual change of test scores in the lowest quartile. Results A total of 732 participants (mean age 76.7 ± 6.6 years) were followed up for 2.9 years (interquartile range 1.0–5.7 years). A linear mixed model showed that diabetes was associated with significant deterioration of Verbal Delayed Free Recall and Recognition scores (P = 0.007 and 0.022, respectively). Among diabetes patients, metformin treatment was not associated with changes of any Korean version of the Consortium to Establish a Registry for Alzheimer's Diseases Assessment component or activities of daily living index. However, rapid deterioration of Mini‐Mental State Examination and Verbal Immediate Recall scores was more frequently found in the metformin‐taking group, even after adjustment for age, sex, education level, baseline cognitive function, baseline glycated hemoglobin levels, renal and liver function, body mass index, hypertension, dyslipidemia, antidiabetic agents other than metformin, and baseline brain imaging abnormality (odds ratio 4.47, 95% confidence interval 1.24–16.05 and odds ratio 7.37, 95% confidence interval 1.19–45.56). Conclusions Metformin treatment was not associated with changes of any of Korean version of the Consortium to Establish a Registry for Alzheimer's Diseases Assessment component scores or activities of daily living index. However, rapid deterioration of Mini‐Mental State Examination and Verbal Immediate Recall scores was more frequently found in the metformin‐treated group. Geriatr Gerontol Int 2019; 19: 755–761.