Background Life-space mobility reflects the extent and independence with which older adults move within their environments and is an integrative indicator of functional capacity and social participation. Objective To examine associations of physical performance and daytime sleepiness with life-space mobility among community-dwelling older adults. Methods A cross-sectional study was conducted among 403 older adults in Chile. Life-space mobility was assessed using the Life-Space Assessment (LSA), physical performance with the Short Physical Performance Battery (SPPB), and daytime sleepiness with the Epworth Sleepiness Scale. Pearson correlations and multivariable linear regression were used to evaluate associations adjusting for age and sex. Results Better physical performance and lower daytime sleepiness were associated with greater life-space mobility in bivariate analyses. In adjusted models, physical performance remained associated, whereas daytime sleepiness was not. Conclusions Physical performance is an important correlate of life-space mobility and may serve as an indicator of functional vulnerability in older adults.