Background: In the elderly, high-density lipoprotein cholesterol (HDL-C) seems to have further clinical meanings besides the inverse relationship with coronary heart disease (CHD); indeed, low values have been found in elderly subjects with functional disability, chronic illness, and in severe clinical conditions. Objective: To verify the hypothesis that low HDL-C might be a ‘marker’ for disability, we evaluated the relationship between lipoprotein parameters and functional status, over a period of 2 years, in a large sample of institutionalized elderly. Methods: 344 institutionalized subjects aged over 65 years were studied. They were divided into two groups according to basal disability level: ‘low–mild’: class A–E, and ‘high’: class F–G of the Katz index. 124 survivors, independent in at least two basic activities of daily living (BADL) at enrollment, were divided into two groups on the basis of 2 years’ modifications in functional status: stable/improved or worsened (lost ≥2 BADL). Results: Total cholesterol, LDL-C, HDL-C, and apo A-I levels were lower in the high disability group, while no differences in triglycerides and apo B levels emerged. Multiple logistic regression analysis showed that severe disability was associated with HDL-C (II vs. III tertile: OR 2.01; CI 95% 1.04–3.91; I vs. III tertile: OR 2.52; CI 95% 1.23–5.15), total cholesterol (I vs. III tertile: OR 2.35; CI 95% 1.14–4.81), blood glucose (OR 0.98), and body mass index (OR 0.91), independently from uric acid, number of pathologies, number of drugs, body cell mass, vitamin B12 and folic acid plasma levels, waist/hip ratio, age, and gender. Subjects who lost ≥2 BADL in the 2-year follow-up consistently showed lower basal HDL-C levels compared to subjects with stable/improved functional status, and this difference was significant after adjustment for basal Katz class, age, gender, number of pathologies, blood glucose, body mass index, and waist/hip ratio. Conclusions: The results of this study suggest that in the elderly severe disability is strongly associated with low HDL-C levels. Longitudinal data support the hypothesis that low HDL-C might be considered as a marker for ‘ongoing’ disability in BADL.