Abstract Background Socio-ecological models emphasize the relationship between the physical environment and physical activity (PA). However, knowledge about this relationship in older adults is limited. Therefore, the present study aims to investigate the relationship between area of residence (urban, semi-urban or rural) and older adults' walking and cycling for transportation and recreation. Additionally, relationships between several physical environmental factors and walking and cycling and possible moderating effects of area of residence, age and gender were studied. Methods Data from 48,879 Flemish older adults collected in 2004-2010 through peer research were analyzed. Walking, cycling and environmental perceptions were assessed using self-administered questionnaires. The Study Service of the Flemish Government provided objective data on municipal characteristics. Multilevel logistic regression analyses were applied. Results Urban participants were more likely to walk daily for transportation compared to rural (OR = 1.43; 95% CI = 1.22, 1.67) and semi-urban participants (OR = 1.32; 95% CI = 1.13, 1.54). Urban participants were less likely to cycle daily for transportation compared to semi-urban participants (OR = 0.72; 95% CI = 0.56, 0.92). Area of residence was unrelated to weekly recreational walking/cycling. Perceived short distances to services (ORs ranging from 1.04 to 1.19) and satisfaction with public transport (ORs ranging from 1.07 to 1.13) were significantly positively related to all walking/cycling behaviors. Feelings of unsafety was negatively related to walking for transportation (OR = 0.93, 95% CI = 0.91, 0.95) and recreational walking/cycling (OR = 0.95, 95% CI = 0.92, 0.97). In females, it was also negatively related to cycling for transportation (OR = 0.94, 95% CI = 0.90, 0.98). Conclusions Urban residents were more likely to walk for transportation daily compared to semi-urban and rural residents. Daily cycling for transportation was less prevalent among urban compared to semi-urban ...