Background We aimed to assess the risk of hospital admission associated with visual impairment in a representative sample of older people living in the community in Britain. Methods Design: Prospective study of hospital admission in a population-based sample of community dwelling people aged 75 years and above in Britain. Setting: 53 general practices. Participants: 14,394 participants in the MRC Trial of Assessment and Management of Older people in the Community. Main outcome measure: Hospital admission. Results Visually impaired older people had 238.7 admissions/1000 person-years compared to 169.7 admissions/1000 person-years in people with good vision: age and sex adjusted rate ratio (RR) 1.32 (95% CI 1.19 to 1.47). Adjusting for a wide range of potential explanatory factors largely eliminated this association: RR 1.06 (95% CI 0.94 to 1.20). However, adjusting for a more limited range of confounding factors, excluding those factors possibly a consequence of reduced vision, left a modest increased risk: RR 1.19 (95% CI 1.06 to 1.34). Conclusion The association between visual impairment and rate of hospital admission can be attributed to higher levels of co-morbidity and reduced functional ability among people with reduced vision. Visual impairment is likely to be an important contributor to reduced functional ability, but other factors may also be involved.