Obesity and diabetes are known risk factors for the development of physical disability among older adults. With the number of seniors with these conditions rising worldwide, the prevention and treatment of physical disability in these persons have become a major public health challenge. Sarcopenia, the progressive loss of muscle mass and strength, has been identified as a common pathway associated with the initial onset and progression of physical disability among older adults. A growing body of evidence suggests that metabolic dysregulation associated with obesity and diabetes accelerates the progression of sarcopenia, and subsequently functional decline in older adults. The focus of this brief review is on the contributions of obesity and diabetes in accelerating sarcopenia and functional decline among older adults. We also briefly discuss the underexplored interaction between obesity and diabetes that may further accelerate sarcopenia and place obese older adults with diabetes at particularly high risk of disability. Finally, we review findings from studies that have specifically tested the efficacy of lifestyle-based interventions in maintaining the functional status of older persons with obesity and/or diabetes.