This study investigated the relationship between measures of executive functioning and both observed and self-reported functional ability. It was hypothesized that performance on a direct assessment of functional ability would have a stronger correlation with performance on measures of executive functioning than a self-report measure of functional ability. Results supported the hypothesis, indicating that self-report measures may not be sensitive to early decline in functional ability. Results also provide evidence to support the use of measures of executive functioning to detect early decline in functional ability that otherwise may not be detected by the typical self-report measures used in clinical settings. While lack of insight into functional deficits has been demonstrated in the literature in older adults with dementia, this study demonstrated lack of insight in a non-demented, community dwelling sample of older adults.