Background A nutritional problem, especially under nutrition is one of the common public health problems in older population causing greater mortality and economic loss in developing countries. However, evidences on the risk factors for increased nutritional risk among older population is not well stated in Ethiopia. This study aimed to assess the nutritional status and predictors of malnutrition among older adults (> = 65 years) in Eastern Ethiopia. Methods A community-based analytical survey was conducted among randomly selected 592 older people aged above 65 years of age in Harari region. Subjects were selected using multistage sampling pretested Full Mini Nutritional Assessment (MNA) tool was used to classify as malnourished (MNA score < 17), at risk of malnutrition (MNA score of 17 to 23.5) and otherwise normal. Validated geriatric depression scale short form (15 items) was employed to screen for depression. Data were presented using statistical tables, frequency, percentage, and graphs. Ordinary logistic regression was employed to identify predictors of malnutrition and plum method was used to generate odds ratio. The level of statistical significance was declared at P-value less than 5%. Chi-square test, crude and adjusted odds ratio with 95% confidence was reported. Results A total of 592 respondents (93.4%) were interviewed. About 306 (51.7%) and 93 (15.7%) were found to be at risk of malnutrition and malnourished respectively. The predicted log odds of being malnourished was higher among those from rural residents (AOR = 2.08: 1.25–3.45), not on working (AOR = 1.31: 95% CI: 0.87–1.95) and did not have health insurance (AOR = 1.58; 95% CI; 0.97–2.58). Those with chronic pain (AOR = 1.70; 95% CI: 1.15–2.51), previous hospitalization (AOR = 1.59: 95% CI: 1.27–2.38) and not able to cover their personal expense (AOR =1.61: 95% CI: 1.12–2.30) were predictors of malnutrition. The relationship between previous hospitalizations with malnutrition among older adults people is moderated significantly by the presence of chronic pain (β = 0.113, p = 0.015). Conclusions Malnutrition among old age is a public health concern that needs attention. Economical vulnerability, residence, depression, presence of chronic disease, and hospitalization were important risk factors for malnutrition among old age.