The construct of intrinsic capacity (IC) in the context of integrated care for older adults emphasizes functional assessment from a holistic perspective. It provides reliable and comparable insights on subsequent functioning and disability. Given the paucity of research on IC and health outcomes in low- and middle-income countries (LMICs), the present study examined the association of IC with geriatric conditions of functional limitations and multiple fall outcomes among older adults in India. The data used for analysis come from the first wave of the Longitudinal Aging Study in India (LASI), 2017–2018. The final sample size contains 24,136 older adults (11,871 males and 12,265 females) age 60 years or above. Multivariable binary logistic regression is employed to examine the association of IC and other explanatory factors with outcome variables of difficulty in activities of daily living (ADL) and instrumental activities of daily living (IADL), falls, fall injury, and multiple falls. Of the total sample, 24.56% of older adults were observed to be in the high IC category. The prevalence of ADL difficulty, IADL difficulty, falls, multiple falls and fall-related injury is estimated to be 19.89%, 45.00%, 12.36%, 5.49% and 5.57%, respectively. Older adults who reported high IC had a significantly lower prevalence of ADL difficulty (12.26% vs 22.38%) and IADL difficulty (31.13% vs 49.52%) than those who reported low IC. Similarly, a lower prevalence of falls (9.42% vs 13.34%), fall-related injury (4.10% vs 6.06%) and multiple falls (3.46% vs 6.16%) were reported among those who had high IC. After adjusting for a large number of confounders such as age, sex, health-related attributes and lifestyle behaviors, older adults with high IC had significantly lower odds of ADL difficulty [aOR: 0.63, CI: 0.52–0.76], IADL difficulty [aOR: 0.71, CI: 0.60–0.83], falls [aOR: 0.80, CI: 0.67–0.96], multiple falls [aOR: 0.73, CI: 0.58–0.96] and fall-related injury [aOR: 0.78, CI: 0.61–0.99]. That a high IC was independently associated with a lower risk of functional difficulty and fall outcomes in later life is of enormous value in predicting subsequent functional care needs. More specifically, the findings here imply that because regular IC monitoring can predict poor health outcomes in older adults, improvements in IC should be prioritized while formulating disability and fall prevention strategies.