Studies of functional impairments in the U.S. elderly population have tended to rely on prevalence estimates from nationally representative health and institutional surveys. These prevalence estimates generally show higher rates of disability for females than males. Unfortunately, prevalence estimates can be misleading when one attempts to assess the risks of certain types of health event transitions for individuals. This study directly examined the individual transitions both into and out of functionally impaired states using longitudinal data from the 1982 and 1984 National Long Term Care Surveys (NLTCS). The data show that, even at very high levels of impairment, there are significant numbers of community residents who apparently manifest long-term improvement in functioning. The longitudinal data also show that the risks of becoming disabled are roughly the same for males and females. This suggests that sex differences in the national prevalence of disabilities arise from the greater longevity of females at any given level of age and functional impairment.