The purpose of this study was to examine the psychosocial and disease-specific factors that influence functional recovery in older adults newly diagnosed with cancer. Multivariate logistic regression models were estimated using panel data from a sample of community-residing adults older than 65 years surgically treated for lung, prostate, breast, or colorectal cancer (N = 172). Data were obtained between 1993 and 1997 during interviews 4 to 6 weeks after cancer surgery for Wave 1 and 14 to 16 weeks after hospital discharge for Wave 2. The outcome measure, functional recovery, was determined by comparing the physical function and physical role subscales of Medical Outcomes Study (MOS) SF-36 over time. Findings showed that prostatectomy patients were more likely to recover by Wave 2 when compared to individuals with lung, colon, or breast resections. Comorbidities and symptom severity were each significantly associated with a decreased probability of recovery. Pain and fatigue were the most common and most severe symptoms reported, regardless of primary site. Psychological well-being was a significant factor influencing functional recovery when age, comorbidities, site of disease, and symptom severity were controlled. The results clearly point to the need for psychological support following cancer surgery.