OBJECTIVE: The influence of psychiatric symptoms and cognitive impairment on daily living skills was explored in a series of nursing home residents. Three categories of symptoms were examined: behavioral disturbances, depression, and delusions. METHOD: Nursing home residents (N=69) underwent comprehensive psychiatric evaluations. Relationships among psychiatric symptoms, cognitive function, and daily living skills were assessed by using regression and correlation analyses. RESULTS: Cognitive decline had the greatest effect on functional impairment in a standard least squares model, followed by behavioral disturbances. Psychiatric symptoms correlated positively with each other and with functional impairment, and correlated inversely with cognitive functioning. CONCLUSIONS: Cognitive decline appears to confer the greatest burden of functional disability in the nursing home setting. After cognitive effects were accounted for, behavioral dysregulation was also associated with functional impairment. In conclusion, interventions to enhance cognition and ameliorate behavioral disturbances are important areas for future studies in long-term care.