Older people differ from younger adults in many perspectives that the gradual loss of physiological reserve is a key feature of aging. The reduced physiological reserve may subsequently increase the vulnerability of older people to physical or environmental stresses. Due to the altered health characteristics, health outcomes and prognostic factors may also vary, which becomes a major challenge in the health care services for older people. Nutritional status and physical health are two important factors for health outcomes of older people, and muscle strength has been recognized as a good prognostic factor. In general, skeletal muscle mass is the major protein reservoir in human body, and may serve to be the energy resources when acute stresses occur to older people. Therefore, declined in muscle strength has been linked to adverse health outcomes in various healthcare settings, either in community settings or acute hospitals. This review summarized the roles of skeletal muscle in the energy balance of older adults, especially when they encounter acute stresses. As an indicator for muscle quality, dominant handgrip strength has been widely used as the measurement for muscle strength and reduced handgrip strength has been shown to be associated with morbidity, dependence in activities of daily living, even mortality among community-dwelling older adults. Moreover, reduced handgrip strength together with other risk factors may significantly predict functional declines among older hospital inpatients. However, the long-term prognostic roles of handgrip strength for older patients after hospital admissions remained unclear that more studies are needed in the future.