Objective: To evaluate whether adding functional exercise training to standard physiotherapy during residential slow-stream rehabilitation (SSR) improves discharge outcomes and functional ability. Design: Randomized controlled trial. Setting: A regional hospital. Participants: Older people (NZ60) admitted to SSR. Intervention: All participants received standard physiotherapy. An individualized functional incidental training (FIT) program was implemented for intervention participants consisting of 4 extra episodes of functional exercise daily for the period of SSR. Research assistants visited twice weekly to practice and progress FIT programs. Main Outcome Measures: Outcome measures included discharge destination, participant-expected discharge destination, and functional tests of the Berg Balance Scale (BBS), de Morton Mobility Index (DEMMI), and 5 times sit-to-stand test (FTSTS) at admission and discharge.