Objective: To assess the construct validity of the DynaPort®KneeTest (KneeTest), which is a performance-based test to assess functioning of patients with knee osteoarthritis (OA). Scores on the KneeTest (KneeScore) were compared with observations of physical therapists of the patients' functional disability. The reliability of these observations was also assessed. Method: Twelve physical therapists received identical video tapes showing the performance of 33 patients on the KneeTest. Each physical therapist rated the functional disability of each patient, performing the 23 activities of the KneeTest, on 23 Visual Analogue Scales (VASactivity). The 23 VASactivity scores were averaged into a VASaverage score. At the end of the test, an overall rating for the general performance of the patient was given on a VASoverall. Inter-observer Reliability was assessed for the VASactivity scores, VASaverage, and the VASoverall. Results: Inter-observer reliability of the VASaverage was higher (ICC 0.85, 95% CI 0.74-0.92) than the VASoverall (ICC 0.65, 95% CI 0.51-0.77). The correlation between the KneeScore and the VASaverage, averaged over the 12 physiotherapists, was 0.86. Conclusion: The construct validity of the KneeTest was supported by the strong correlation with the ratings of the patients' disability by physical therapists. Given these findings and the high test-retest reliability of the KneeTest that was found in our previous study, we conclude that the KneeTest is a valid measure for assessing functioning in orthopedic and physical therapy research in patients with knee-OA before and after total knee replacement. Longitudinal validity has to be evaluated yet.