The purpose of this study is to examine the relative importance of the force-based and velocity-based measures of muscle performance to explain inter-individual differences in power production capability and functional task performance. Participants included seventy-nine men and women: middle-aged healthy adults (MH: 40–55years), older healthy adults (OH: 70–85years), and older adults with mobility limitations (OML: 70–85years). Muscle power at 180°/s, isometric maximal torque, and maximal contraction velocity at 40% 1RM were measured during unilateral leg extension. The Short Physical Performance Battery (SPPB) was used to differentiate between healthy and mobility limited older adults. Functional task performance was assessed using multiple chair rise and stair climb tests. Leg extensor force (torque), but not maximal contraction velocity, was significantly associated with muscle power in MH. Both torque and velocity were significantly associated with muscle power in OH. Maximal velocity, but not torque, was associated with power in OML. Maximal velocity demonstrated an association with multiple chair rise time and stair climb time in OML, but not MH or OH. It is concluded that movement velocity is an increasingly important determinant of maximal power output with advancing age. Furthermore, movement velocity is also a critical component of functional task performance with aging and may contribute to functional deficits. These findings help to explain why the rate-dependent variable power has emerged as a critical component of both assessment and rehabilitation of muscular performance and physical function in older adults.