Background: Impaired nutrition is associated with greater treatment toxicity and reduced overall survival in patients with advanced cancer. We aimed to evaluate the association of impaired nutrition with psychological health and quality of life among older adults with advanced cancer who were starting cancer treatment with palliative intent. Methods: This secondary analysis was performed on baseline data from a nationwide cluster randomized clinical trial (ClinicalTrials.gov identifier: NCT02107443; PI: Mohile; funding NCI UG1CA189961). Adults age ≥70 with advanced cancer and≥1 geriatric assessment impairment were enrolled from 2014 to 2017. Patients with BMI < 21 kg/m², > 10% involuntary weight loss in the past 6 months, or Mini Nutritional Assessment Short Form (MNA-SF) score of ≤11 were considered to have impaired nutrition. We used separate multivariable linear regressions to evaluate the association of impaired nutrition with each measure of psychological health and quality of life, which included Geriatric Depression Scale (GDS-15, range 0-15), Generalized Anxiety Disorder-7 (GAD-7, range 0-21), NCCN Distress Thermometer (NCCN DT, range 0-10) and Functional Assessment of Cancer Therapy-General (FACT-G, range 0-108). Analyses were adjusted for baseline patient demographics, clinical characteristics, and geriatric assessment. Results: Among 541 patients, mean age was 77 (range 70-96) and 60% had impaired nutrition. Among the 326 patients with impaired nutrition, 95% had MNA-SF ≤11, 23% had > 10% weight loss in the last six months, and 20% had BMI < 21 kg/m². Mean baseline GDS-15 was 3.1 (standard deviation [SD] 2.7), GAD-7 was 2.9 (SD 4.0), NCCN DT was 2.9 (SD 2.7), and FACT-G was 80 (SD 14). In the adjusted model, compared to those with normal nutrition, older adults with impaired nutrition had greater depression (mean 0.65 points higher on the GDS-15, p < 0.01) and lower quality of life (mean 6.0 points lower on the FACT-G, p < 0.01). There was insufficient evidence of an association between nutrition and anxiety (β = 0.67, p = 0.06) or distress (β = 0.26, p = 0.28). Conclusions: Recognition of malnutrition by oncology providers is crucial for older adults with advanced cancer. Impaired nutrition is associated with greater depression and lower quality of life among older adults with advanced cancer. Tailored resources to improve psychological health and quality of life are needed to support older adults with impaired nutrition receiving cancer treatment.