Older adults are relatively physically active compared to other age group. A lack of physical activity (PA) can cause chronic diseases including osteoarthritis of knee (OA knee) and might eventually reduce quality of life (QOL). This present study was aimed to investigate association between levels of PA and OA knee with levels of QOL in community-dwelling older adults. One thousand and sixty-seven community-dwelling older persons were recruited to this descriptive study. PA activity questionnaire was invented. Standardized Oxford knee score and World Health Organization’s Quality of Life scale (WHOQOL-BREF) were used to measure OA knee and QOL levels. Results showed that levels of PA in older adults were significantly associated with levels of OKS (χ² = 78.565, P-value < .001) and levels of OA knee in older adults were significantly associated with levels of overall QOL (χ² = 57.738, P-value < .001). Pearson’s correlation also showed interrelation among PA, OA knee, and QOL. In conclusion, PA, OA knee, and QOL are interrelated. Therefore, close monitoring and design of proper PA activity should be implemented in community-dwelling older adults with OA knee.