Abstract Background Identification of novel risk factors for dementia in older adults could facilitate development of methods to identify patients most at risk and improve their cognitive outcomes. We aimed to determine whether lower appendicular lean mass (ALM), assessed by dual-energy x-ray absorptiometry (DXA), and lower grip strength are associated with a greater likelihood of incident dementia among older adults in the Health Aging and Body Composition Study (Health ABC). Methods Health ABC data from 1997 to 2008 were analyzed (n = 2 704). Baseline ALM to body mass index (BMI) ratio (ALMBMI) was assessed by DXA. Baseline grip strength was assessed by hand-held dynamometry. Incident dementia diagnosis was defined as either (i) dementia-related hospitalization plus a Modified Mini-Mental State Examination (3MS) score of ≤ 90; or (ii) record of prescription for anti-dementia medication; or (iii) decline of at least 1.5 SDs on the 3MS score compared to baseline. Cox proportional hazard models estimated associations of ALMBMI and grip strength with incident dementia over follow-up with and without adjusting for covariates, stratified by sex. Results Among older men, each standard deviation decrement in ALMBMI (adjusted hazard ratio [aHR]: 1.33; 95% confidence interval [CI]: 1.07, 1.65) or grip strength (aHR 1.22; 95% CI: 1.06, 1.41) was associated with increased likelihood of incident dementia. Conclusions Lower ALMBMI and grip strength may be important risk factors for the development of dementia among older men. How these factors may belong to a causal pathway of dementia must be elucidated in future work.