Background: Impairment in daily functioning is a clinical hallmark of dementia. Difficulties with “instrumental activities of daily living” (IADL) seem to increase gradually over the course of Alzheimer’s disease (AD), before dementia onset. However, it is currently not well established how difficulties develop along the preclinical and prodromal stages of AD. We aimed to investigate the trajectories of decline in IADL performance, as reported by a study partner, along the early stages of AD. Methods: In a longitudinal multicenter study, combining data from community-based and memory clinic cohorts, we included 1555 individuals (mean age 72.5 ± 7.8 years; 50% female) based on availability of amyloid biomarkers, longitudinal IADL data, and clinical information at baseline. Median follow-up duration was 2.1 years. All amyloid-positive participants (n = 982) were classified into the National Institute on Aging–Alzheimer’s Association (NIA-AA) clinical stages ranging from preclinical AD (1) to overt dementia (4+). Cognitively normal amyloid-negative individuals (n = 573) served as a comparison group. The total scores of three study-partner reported IADL questionnaires were standardized. Results: The rate of decline in cognitively normal (stage 1) individuals with and without abnormal amyloid did not differ (p =.453). However, from stage 2 onwards, decline was significantly faster in individuals on the AD continuum (B [95%CI] = − 0.32 [− 0.55, − 0.09], p =.007). The rate of decline increased with each successive stage: one standard deviation (SD) unit per year in stage 3 (− 1.06 [− 1.27, − 0.85], p <.001) and nearly two SD units per year in stage 4+ (1.93 [− 2.19, − 1.67], p <.001). Overall, results were similar between community-based and memory clinic study cohorts. Conclusions: Our results suggest that the rate of functional decline accelerates along the AD continuum, as shown by steeper rates of decline in each successive NIA-AA clinical stage. These results imply that incremental changes in function are a meaningful measure for early disease monitoring. Combined with the low-cost assessment, this advocates the use of these functional questionnaires for capturing the effects of early AD-related cognitive decline on daily life.