Purpose: This study was to determine whether the Sun-style 24 forms of Tai Chi exercise improve pain, stiffness, disability, knee joint motion, mobility, balance or falling. Method: Forty-six community-dwelling elderly subjects (mean age, $75.46{pm}6.28$) voluntarily participated in an intervention group of either 24 forms of Sun-style T ai Chi for 60 min, 2 times per week for 12 weeks or a control group. A non-equivalent pretest-posttest design was used. Independent t-test and ANCOVA were used to examine group differences by using SPSS12.0. Result: The experimental group had significantly less pain (F=7.60, p=.008) and stiffness (t=-3.19, p=.003) than the control group. Also there were significant improvements in knee joint motion on the right knee (t=2.44, p=.019), left knee (t=2.30, p=.026), rising time (F=8.03, p=.07), balance on the left single leg test (t=2.20, p=.033), and fear of falling (t=-2.33, p=.024) in the Tai Chi exercise group. No significant group differences were found in disability and falls efficacy. Conclusion: The Sun-style 24 forms Tai Chi exercise is effective in decreasing pain, stiffness, fear of falling and it improves balance, rising time, and knee joint motion. We suggest a continuing long term intervention to decrease disability and increase efficacy concerning falls.