Background To determine whether increasing claudication severity is associated with impaired balance and physical functional ability. Methods A prospective observational study in claudicants was performed. Disease severity was determined according to Rutherford’s criteria. Patient’s balance was assessed objectively using computerized dynamic posturography (CDP—Sensory Organization Test [SOT]; NeuroCom). “Bedside” assessment of balance was performed using the Timed Up and Go (TUG) test (dynamic balance) and the Full Tandem Stance test (static balance). Physical function was assessed using the Summary Physical Performance Battery (SPPB) score. Results 185 claudicants were assessed (median age of 69 [IQR 63–74] years; 137 [74.1%] men). Fourteen claudicants were classified as Rutherford grade 0, 26 as grade I, 76 as grade II, and 69 as grade III. All Rutherford groups were comparable for age, gender, BMI, and comorbidities. Increasing Rutherford grade was associated with a significant deterioration in objective balance as determined by a failed SOT test: 3 (21.4%) in grade 0; 9 (34.6%) in grade I; 39 (52.7%) in grade II; and 41 (59.4%) in grade III (chi-squared 9.693, df 3, P = 0.021). A significant difference was also found with dynamic balance (TUG test), but not static balance (full tandem stance). Increasing claudication severity was also associated with significantly worse physical function: SPPB score. Conclusions Specific objective tests demonstrate impaired balance and physical function are common in claudicants and become more frequent with increasing severity of claudication. Simple “bedside” measures may be sufficiently sensitive to detect this.