ABSTRACT. Aerobic capacity declines significantly throughout life, beginning at the age of 30 years and accelerating from 60 years, where a decline of 17% per decade is expected thereafter. Objective: To investigate the association between aerobic capacity and a diagnosis of mild cognitive impairment (MCI), mild AD or moderate AD in older adults, considering the risk classification of functional loss of the Step test. Methods: In this cross-sectional study, 93 patients (age >60 years) were evaluated (Healthy=36; MCI=18, AD=39). The step test was used to assess aerobic capacity, while overall cognitive status was measured using the MMSE. The groups were divided according to the risk classifications of functional loss into below or above the standard cut-off point for aerobic capacity. Results: Subjects in the functional loss risk group were approximately ten to fourteen times more likely to be diagnosed with mild (OR:10.7; p=0.001) or moderate (OR.=14.7; p=0.002) AD than their fitter counterparts. Low aerobic fitness was also associated with the MCI condition (OR=4.5; p=0.05), but only after controlling for educational level, age and sex. In the overall sample (N=93), there was an association between aerobic capacity and MMSE performance (R2=0.35; p<0.001) after controlling for confounding variables. Conclusion: low aerobic capacity was associated with cognitive decline, and older adults at risk of functional loss on the STEP test had greater chance of being diagnosed with MCI or AD after controlling for age, sex and education.