BACKGROUND: We assessed the acute and long-term effect of myocardial infarction (MI) and stroke on postevent functional disability and cognition while controlling for survivors' changes in functioning over the years before the event. METHODS AND RESULTS: Among participants in the nationally representative Health and Retirement Study with linked Medicare data (1998-2010), we determined within-person changes in functional limitations (basic and instrumental activities of daily living) and cognitive impairment after hospitalization for stroke (n=432) and MI (n=450), controlling for premorbid functioning using fixed-effects regression. In persons without baseline impairments, an acute MI yielded a mean acute increase of 0.41 functional limitations (95% confidence interval [CI], 0.18-0.63) with a linear increase of 0.14 limitations/year in the following decade. These increases were 0.65 limitations (95% CI, 0.07-1.23) and 0.27 limitations/year afterward for those with mild-to-moderate impairment at baseline. Stroke resulted in an acute increase of 2.07 (95% CI, 1.51-2.63) limitations because of the acute event and an increase of 0.15 limitations/year afterward for those unimpaired at baseline. There were 2.65 new limitations (95% CI, 1.86-3.44) and 0.19/year afterward for those with baseline mild-to-moderate impairment. Stroke hospitalization was associated with greater odds of moderate-to-severe cognitive impairment (odds ratio, 3.86; 95% CI, 2.10-7.11) at the time of the event, after adjustment for premorbid cognition but MI hospitalization was not. CONCLUSIONS: In this population-based cohort, most MI and stroke hospitalizations were associated with significant increases in functional disability at the time of the event and in the decade afterward. Survivors of MI and stroke warrant screening for functional disability over the long-term.