This study aimed to examine characteristics of physical functions, physical activity, and cognitive functions among community-dwelling older people who stopped driving automobiles. Participants were 589 community-dwelling older people (age: 65–89, 71.4 ± 5.1 years; 403 men, 186 women). The participants underwent nine physical assessments—hand grip strength, knee extension strength, timed up-and-go test, chair stand, one leg standing with open eyes, functional reach, vertical jump, preferred gait speed, maximal gait speed—and were evaluated for physical activity; and five cognitive assessments—the Mini-Mental State Examination (MMSE), Logical Memory I and II (WMS-R LM-I, LM-II) subtests of the Wechsler Memory Scale-Revised; and Trail Making Test A and B (TMT-A, TMT-B). They were divided into current driver (379 men, 169 women) and driving cessation (24 men, 17 women) groups. Among men, the driving cessation group had poorer vertical jump, TMT-A, and TMT-B results, while women had poorer hand grip strength, one leg standing with open eyes, WMS-R LM-II, and LM-II results, and longer inactivity time, compared with the current driver group and adjusted for covariates (P < 0.05 for all). The findings suggest driving cessation among community-dwelling older people is significantly associated with poorer physical functions, physical activity, and cognitive functions compared with those in current drivers.