Aim To assess the effect of early rehabilitation on improving activities of daily living (ADL) in elderly patients with aspiration pneumonia. Methods Using the Japanese Diagnosis Procedure Combination inpatient database, we retrospectively analyzed consecutive patients with aspiration pneumonia at admission who received early rehabilitation (n = 48 201) or did not receive any rehabilitation (n = 64 357) from July 2010 to March 2013. Early rehabilitation was defined as any type of physical rehabilitation initiated within 7 days after admission. The proportions of improved ADL scores from admission to discharge were compared between the early rehabilitation group and the non‐rehabilitation group using a multivariable logistic regression analysis and instrumental variable analysis. Results The proportion of improved ADL scores was higher in the early rehabilitation group than in the non‐rehabilitation group (25.4% vs 33.9%; P < 0.001). The multivariable logistic regression analysis showed that the early rehabilitation group exhibited significant improvement in ADL (odds ratio 1.57; 95% confidence interval 1.50–1.64; P < 0.001). The instrumental variable analysis showed that early rehabilitation was associated with increased proportion of improved ADL (risk difference 8.2%; 95% confidence interval 6.9–9.5%; P < 0.001). Conclusions The present results suggest that early rehabilitation might improve ADL during hospitalization in patients with aspiration pneumonia. Geriatr Gerontol Int 2016; 16: 1181–1187.