Abstract Background Muscle fatigue reduces muscle strength and balance control in young people. It is not clear whether fatigue resistance seen in older persons leads to different effects. In order to understand whether muscle fatigue may increase fall risk in older persons, a systematic literature review aimed to summarize knowledge on the effects of lower extremity and trunk muscle fatigue on balance and functional tasks in older people was performed. Methods Studies were identified with searches of the PUBMED and SCOPUS data bases. Papers describing effects of lower extremity or trunk muscle fatigue protocols on balance or functional tasks in older people were included. Studies were compared with regards to study population characteristics, fatigue protocol, and balance and functional task outcomes. Results Seven out of 266 studies met the inclusion criteria. Primary findings were: fatigue via resistance exercises to lower limb and trunk muscles induces postural instability during quiet standing; induced hip, knee and ankle muscle fatigue impairs functional reach, reduces the speed and power of sit-to-stand repetitions, and produces less stable and more variable walking patterns; effects of age on degree of fatigue and rate of recovery from fatigue are inconsistent across studies, with these disparities likely due to differences in the fatigue protocols, study populations and outcome measures. Conclusion Taken together, the findings suggest that balance and functional task performance are impaired with fatigue. Future studies should assess whether fatigue is related to increased risk of falling and whether exercise interventions may decrease fatigue effects.