Objectives: This study targeted the elderly participating in community exercise classes implemented by the local government, and followed their fall risk and physical function characteristics for three years. This study aimed to compare these changes between low and high fall risk individuals. Methods: The participants consisted of 34 male and 163 female Japanese elderly people aged 60 years or over who participated in a community exercise class once a week for three years. Physical fitness and activities of daily living (ADL) capability were evaluated by the physical fitness test of the Ministry of Education, Culture, Sports, Science and Technology in Japan. The fall risk was evaluated using a Fall Assessment Chart (Suzuki, 2000), and if the total score was ≥5, the subject was assessed as a high fall risk. Significant changes in the fall risk characteristics were examined by McNemar's test. Significant changes in physical function characteristics (Physical fitness and ADL tests) were examined by two-way (fall risk group and pre-post) ANOVA. Results: The fall risk and number of falling incidents decreased only for the high risk group. In addition to the observed decrease in risk and incidents, it was found that the elderly who exercised were able to maintain their physical function (ADL capability level) with regard to muscular strength, walking, and maintaining and changing posture over the course of the three-year study. Conclusions: Effectiveness of the exercise class implemented by the local government for fall prevention was found for the high fall risk elderly. These findings indicate the possibility that health promotion activities based on exercise classes may be a prevention strategy for falls within the community-dwelling elderly by incorporating more diverse activities adapted to an individual's functional level.