Given the increasing number of older adults in the population, the fact that about 1 in 10 people over the age of 65 will develop mild cognitive impairment, and the substantial individual, familial, and financial burden associated with such disorders, the need for innovative research examining cognitive impairment in older adults is evident. The present study used a microlongitudinal design to assess cognition and contextual factors that may affect cognition for 14 consecutive days using a daily diary method in older adults with varying degrees of cognitive function. This study design enables investigation of concurrent associations between variables, as well as providing unique information not gleaned from the traditional focus on mean values of cognition. The present study had two broad aims: 1) to compare variability in cognition in older adults with varying degrees of cognitive impairment and 2) to investigate relationships between daily cognitive performance, variability in cognitive performance, and contextual factors that may influence daily cognitive performance and variability in older adults with varying degrees of cognitive impairment. Results suggest there was sufficient intraindividual variability in daily cognition to warrant investigation of within-person associations. Furthermore, the contextual factors of pain, stress, and sleep were predictive of cognitive performance, but with significance and directionality of these associations depending on level of measurement (baseline, daily, or mean values). Finally, associations between contextual factors and cognition were frequently conditional upon baseline cognitive status. The findings highlight the need for continued examination of these associations to expand our understanding of cognition in older adults and to discover potential targets for interventions to attenuate cognitive decline.