This study used vision loss due to age-related macular degeneration to learn about adaptation processes related to chronic functional impairment, focusing on Horowitz and Reinhardt’s (1998) concept of Adaptation to Age-related Vision Loss (AVL) as the outcome. We hypothesized that impacts of visual acuity on AVL are mediated by perceived functional vision losses and functional abilities, and tested for “adaptive” weakening of this impact with ongoing loss. Longitudinal data covering a one-year interval from samples with age-related macular degeneration gathered in New York (N = 361) and Heidelberg (Germany, N = 90) were used. We analyzed the hypothesized causal structure by modeling latent change scores, and checked if those with low, medium, and high levels of vision loss at baseline differ in the relations between one-year change scores. Results confirmed that impacts of vision loss on AVL are mediated by decline in functional ability. However, under the most severe levels of vision loss at baseline, functional decline showed only a minor impact on AVL change not explained by a lack of further decline in vision. Findings confirm the effectiveness of adaptation in terms of reduced reactivity to functional losses across increasing level of chronic impairment. Thus, adaptation, weakening the impact of chronic functional impairment on psychological outcomes over time with disease progression, deserves consideration in the study of psychological consequences of chronic physical health conditions in old age.