Using Tai Chi as an exercise mode, this study examined the association between self-efficacy and physical function. Ninety-four healthy, physically inactive older adults (M age = 72.8 years, SD = 5.1) were randomly assigned to either a 6-month, twice a week, Tai Chi condition or a wait-list control condition. Outcome variables included self-reports of movement efficacy and physical function assessed at baseline, middle, and termination of the study. Multisample latent curve analyses revealed a significant rate of change attributable to the Tai Chi intervention in both self-efficacy and physical function, with participants experiencing significant improvements over the course of the intervention. Analyses also showed a positive association between self-efficacy and physical function, indicating that improvements in older adults' self-efficacy of movement as a function of Tai Chi were related to increased levels of perceived physical capability. This study uncovered the need for further exploration of the relationship between exercise self-efficacy and physical function for enhancing health-related quality of life in older adults.