Purpose: The main purpose of this study was to identify factors affecting medication adherence and to develop an explanatory model for medication adherence in elders with chronic disease. Method: Empirical data were collected from 312 older adults with chronic disease and the data collect period was from August 8 to 31, 2011, and were analyzed using SPSS for Windows 19.0 program and confirmatory factor analysis with the structural equation model (SEM) procedure performed with AMOS 19.0 program. Results: Results of this study showed that perceived self-efficacy was the strongest factor influencing medication adherence, and it affected also outcome expectations positively but impediments were negatively influenced by self-efficacy. Outcome expectations and impediments subsequently acted on medication adherence with the same relationship as self-efficacy. In additional results, self-efficacy and medication adherence were further significantly affected by the factors; social support, medication knowledge, and depression. Conclusion: These results show that nursing interventions to promote medication adherence in this population should focus on self-efficacy promotion including social support, education for delivery of medication knowledge, and reduction in depression.